New amendments to NEPA in the Fiscal Responsibility Act of 2023
NEPA practitioners have become accustomed to changes governing their work over the past three years. During President Trump’s administration, there were many changes to the Council on Environmental Quality’s (CEQ) National Environmental Policy Act (NEPA) implementing regulations proposed and finalized. The Biden administration subsequently proposed and finalized different regulations, reversing some of the Trump administration changes.
That changed on June 3, 2023, when President Biden signed the Fiscal Responsibility Act of 2023 (FRA 2023) after months of negotiations aimed at avoiding a breaching of the debt ceiling. In addition to the debt limit suspension and various budgetary provisions, the FRA 2023 includes important changes to NEPA with the aim of streamlining the environmental review process. These changes are in a section of the FRA 2023 known as the “Builder Act.”
NEPA is a brief and high-level law. Because of this, CEQ developed NEPA implementing regulations and various guidance documents to provide clarity and to guide agencies in NEPA compliance. These regulations and guidance can be changed by a new administration. Changing NEPA itself, however, is significant in that it requires an act of Congress. Thus, the FRA 2023 changes to NEPA are likely to last longer than the recent back and forth in regulations.
The FRA revisions and additions to NEPA are primarily a mix of the Trump 2020 NEPA Regulations and the previously revoked One Federal Decision (OFD) framework. The Biden administration’s CEQ has been in the process of developing Phase 2 regulations, which were likely to continue to move further away from elements in the Trump 2020 NEPA regulations. With the FRA 2023 change in the NEPA statute, anything that CEQ may have been planning that conflicts with the FRA 2023 changes cannot be advanced at this time, and unless and until further Congressional actions.
As there were a number of changes to NEPA in FRA 2023, lead agencies and NEPA practitioners are encouraged to review the entire language of the relevant sections of the FRA 2023 in determining their approaches to NEPA compliance. Here are our key takeaways:
One federal lead agency
The FRA 2023 requires that one federal agency shall be designated to coordinate with participating agencies and oversee the preparation of a single environmental document. The lead agency must be determined in coordination with other agencies, including applicable state, tribal, or local agencies based on several factors such as the magnitude of the agency’s involvement in the action, which agency approves the action, and expertise concerning the action’s environmental effects. The lead agency must develop a schedule, in consultation with each cooperating agency, the applicant, and other entities that the lead agency determines appropriate, for timely completion of any environmental review, permit, or authorization required to carry out the proposed action. The federal lead may also designate state, tribal, or local agencies as joint lead agencies.
Time and page limits
Page and time limits have often been looked upon as a means to expedite the NEPA process. However, in practice, their effect on accelerating projects may be less than intended.
Page limits
The page limits prescribed mirror those currently in place by CEQ’s NEPA Implementing Regulations; those are 75 pages for an Environmental Assessment (EA) and 150 pages for an Environmental Impact Statement (EIS) with up to 300 pages allowed for projects of extraordinary complexity. These page limits do not include citations or appendices.
For page limits, a workaround by NEPA practitioners is likely. While the main NEPA document will be 75 (EA) or 150–300 pages (EIS), lengthy technical analyses and documentations will be moved to appendices and the main document will become but an extended Executive Summary. Taking into account appendices, the actual document may not be reduced much in length. However, given that decision-makers and the general public are unlikely to read a lengthy document anyway, a good and concise summary main document can serve most NEPA users just fine.
Time limits
The prescribed time limits also mirror the current CEQ NEPA Implementing regulations, with two years allotted for an EIS and one year for an EA. What has changed is the start time for the one- and two-year deadlines. Currently for EISs, two years is measured from the date of the issuance of the Notice of Intent (NOI) to the date a record of decision is signed. For EAs, one year is measured from the date of agency decision to prepare an EA to the publication of a Finding of No Significant Impact. With the FRA 2023, the schedule for both EISs and EAs must start on the sooner of these three dates:
- The date the agency decides they need to do an EIS or EA.
- The date the agency informs the applicant that the right-of-way application is complete.
- The date on which the NOI is issued.
This will almost certainly move the starting clock forward, as agencies know long before an NOI is published that they plan to prepare an EIS or an EA. Similarly for right-of-way applications, a decision is often made on the completeness of an application months before the NOI is issued. Consequently, for both EAs and EISs, the substantive preparation time for these documents may be considerably shortened in many cases compared to the status quo start times.
The prior imposition of time limits for many projects have only resulted in movement of project and alternatives development, baseline surveys, and early engagement before the formal commencement of the NEPA process. For example, if a prior EIS process took four years, but now there are two years of planning work before start of NEPA and then two years for the EIS, there would be no actual reduction in total time. Enhanced pre-NEPA planning is a good practice to be sure, but the actual effect of formal time limits may be less than anticipated.
Court-ordered preparation schedules
If a lead agency is not able to meet the above time limits for private projects, the deadline is allowed to be extended in consultation with the applicant. A new deadline that provides only so much additional time as is necessary to complete either an EIS or an EA is permissible.
If a project sponsor believes that the agency is not meeting the established deadlines, it can file a court petition. And if the court agrees, the court can set a schedule for the agency to act as soon as practicable. However, this cannot exceed 90 days from the date of the court order, unless the court determines that a longer period of time is needed to comply with the applicable law(s).
Project sponsor allowed to prepare EISs
Similar to what was introduced by the Trump 2020 NEPA Regulations, which was a major departure from the then-existing requirements, project sponsors can prepare EISs. However, lead agencies need to prescribe procedures to allow project sponsors to prepare an EA or EIS under the supervision of the agency. The lead agency can, but is not required to, provide project sponsors with guidance and assist in the preparation of the EA or EIS. Once the document is complete, the lead agency is required to independently evaluate it and take responsibility for the contents. It is unclear what the implication of time limits is in the case of sponsor preparation of an EIS. Furthermore, if a lead agency finds a sponsor-prepared EIS to be inadequate, do the time limits still apply?
Defining major federal action
The definition of major federal action is “an action that the agency carrying out such action determines is subject to substantial Federal control and responsibility.” Additionally, a list of actions not considered to be major federal actions is included in the FRA 2023 and is consistent with the list in the current NEPA implementing regulations, as promulgated by President Trump’s CEQ. This list includes the following:
- Non-federal actions.
- General revenue-sharing funds with no federal oversight.
- Loans, loan guarantees, or other forms of financial assistance where a federal agency does not exercise sufficient control and responsibility over the use of such funds.
- Certain business loan guarantees provided by the Small Business Administration.
- Judicial or administrative civil or criminal enforcement actions.
- Agency activities or decisions with effects located outside of the United States.
- Non-discretionary activities or decisions.
While the FRA 2023 defines actions that are not major federal actions, it does not provide examples of actions that are major federal actions. Lead agencies and NEPA practitioners will continue to apply professional judgement in making that interpretation.
Programmatic environmental documents
The FRA 2023 provides clarification that a programmatic NEPA document may be relied upon for a period of five years as long as the agency is not aware of any substantial new circumstances or information affecting the significance of the analyzed adverse effects. However, after five years, the programmatic document must be reevaluated. If after five years there is no substantial new information that bear on the analysis, and the underlying assumptions and analysis remain valid, then no new programmatic document needs to be completed.
Adoption of categorical exclusions
Any federal agency can use the categorical exclusions of any other federal agency as long as they conduct the following activities:
- Consult with the agency whose categorical exclusion is being adopted to ensure that its use is appropriate.
- Inform the public of the categorical exclusion that the agency plans to use for its proposed action.
- Document the adoption of the categorical exclusion used.
No such documentation, however, is required when an agency implements one of its own categorical exclusions.
Modernizing NEPA
In an attempt to modernize NEPA, address delays, and improve public accessibility and transparency, a Permitting Portal Study by CEQ is called for. This study will examine the potential for the use of a permitting portal in which applicants could submit required documents or materials for their project, collaborate with agencies to edit documents in real-time, and track the progress of individual applications. This portal would include a cloud-based, digital tool for more complex reviews that would centralize across all necessary agencies the information (documents, GIS, etc.) required for reviews.
This digital tool would also streamline communications between all necessary agencies and the applicant, allow for comments and responses by and to all necessary agencies in one unified portal, generate analytical reports to aid in organizing and cataloguing public comments, and be accessible on mobile devices. This tool is aimed at boosting public transparency by providing information suitable for a lay reader, including scientific data and analysis, and the anticipated agency process and timeline. CEQ has been given a one-year timeframe and $500,000 to conduct this study.
Impacts of the No-Action Alternative
An analysis of any negative environmental impacts resulting from the No-Action Alternative needs to be included in a NEPA document. Many agencies already analyze the environmental consequences of the No-Action Alternative; however, this is not always the case.
What does this all mean for NEPA?
Congress revised NEPA for the purposes of limiting its reach with respect to covered agency actions—and promoting more timely, concise, and effectively coordinated document preparation and decision-making between the involved federal agencies when NEPA is applicable.
Overall, these statutory changes are significant in that they not only amend NEPA, but they eliminate any conflicting regulatory changes that CEQ was anticipating making in its Phase 2 Regulations. CEQ’s Phase 2 Regulations will not be able to change any of the FRA 2023 provisions to NEPA. CEQ will need to ensure that the current regulations and any proposed changes are consistent with the new NEPA as well as revise its affected guidance documents accordingly.
Agencies will also need to revisit their NEPA procedures. The current CEQ regulations requirement for agency revisions is September 14, 2023, which will necessitate a quick regulatory change by CEQ. Even though most of the changes in the NEPA statute do not represent substantial change to recent NEPA practice, there is no doubt that CEQ, federal agencies, NEPA practitioners, and the courts will interpret any areas of question about the new changes as well as the overall statute as had occurred over the last 50 years.
ICF has worked with federal agencies as well as applicants to comply with NEPA for many decades, through changing interpretations of CEQ regulations, guidance, court rulings, and administrations. Wherever NEPA goes next, ICF is here to help.
