On December 10, 2024, the U.S. Supreme Court heard arguments in a case that could reshape how federal agencies conduct environmental reviews under the National Environmental Policy Act (NEPA). The case, Seven County Infrastructure Coalition v. Eagle County, Colorado (“Seven County”), focuses on how far agencies must go in analyzing environmental impacts of projects, particularly those that are geographically or temporally remote.
What’s at Stake?
The case concerns an 88-mile rail line proposed in Utah’s Uinta Basin, a project reviewed by the Surface Transportation Board (STB). The STB approved the project, producing a 3,600-page Environmental Impact Statement (EIS) pursuant to its obligations under NEPA. However, the D.C. Circuit Court of Appeals ruled the EIS was insufficient, requiring the agency to study broader effects of the proposed crude oil transport rail line, such as pollution from oil refineries located thousands of miles from the project. The Supreme Court is reviewing the D.C. Circuit’s decision.
NEPA reviews often involve time-intensive coordination efforts and result in thousands of pages of scientific support, such as the one seen in Seven County. The Supreme Court’s decision could establish a clearer standard for what “reasonably foreseeable” environmental effects must be considered in NEPA reviews. A narrower standard would streamline NEPA reviews, cutting costs and reducing delays for federal approvals. The outcome of the case could significantly impact large-scale linear projects like roads and utility lines, as well as approvals of ports and airports – projects which authorize transportation activities that span miles.
Key Arguments
Petitioners (Seven County Infrastructure Coalition and Uinta Basin Railway LLC)
Paul Clement, counsel for Petitioners Seven County Infrastructure Coalition and Uinta Basin Railway LLC, the proponents of an 88-mile rail line in the Uinta Basin of Utah, proposed a very narrow test. In essence, the Petitioners argue that a prior Supreme Court case called Public Citizen should be understood as holding that a decision-making agency need not consider an environmental effect if:
- It is remote in time and space to the action at issue, and
- The agency lacks authority to stop the effect from happening.
Under this test, the Petitioners contend that the upstream and downstream effects in the Seven County case – the oil production within the basin, and the oil refinement in Gulf Coast communities – would not need to be considered because they are temporally and geographically remote and regulated by other agencies, not the STB, which is charged with the review of rail line projects. The Petitioners argue the STB’s decision to exclude a more detailed analysis of those effects from its EIS was well within reason.
To take another example, the United States Army Corps of Engineers issues permits for discharges of dredge and fill material in wetlands and other surface waters. Under the Petitioners’ test, the Corps’ environmental effects review under NEPA when issuing a permit for a phosphate mine, for example, would be limited to considering only impacts of the mine on wetlands and surface waters. The Corps would not need to consider the ultimate “downline” processing of phosphate which is under another agency’s regulatory authority.
Justices’ Response:
Justices Jackson and Sotomayor seemed skeptical of Petitioners’ test. Justice Jackson characterized it as “unmoored from the purposes of NEPA” which is to inform the agency with respect to its own decision-making process through the agency’s consideration of environmental consequences beyond those of the immediate project subject to approval. Justice Sotomayor also criticized Petitioners’ position as proposing “absolute rules that make no sense.”
Justice Jackson questioned the need for the new test when the traditional standard for court review is arbitrary and capricious, where courts give deference to agencies’ decisions under NEPA. Mr. Clement responded that Petitioners believe there is a need for a “new test plus deference” to ensure agencies don’t need to “lard up” their EIS’s in anticipation for a challenge. Note that while the Court’s decision in Loper Bright last term overruled “Chevron” deference, it did not disturb the “arbitrary and capricious” standard of review applicable to agencies’ NEPA decisions.
Federal Government (Surface Transportation Board)
Deputy Solicitor General Edwin Kneedler, counsel for the federal government, argued second and also defended the sufficiency of the 3,600-page EIS in this case. Unlike Petitioners, the federal government argued against hard and fast rules, supporting context-specific analyses, and emphasizing agency discretion in determining which effects should be considered.
Justices’ Response:
Justice Kavanaugh commented that the courts historically have taken an “overly aggressive role” in NEPA litigation by second guessing agencies, which has incentivized agencies to engage in lengthy NEPA reviews. As a result of new NEPA amendments, which limit EIS’s to 150 pages, Kavanaugh views the necessary standard for judicial review as “deference squared.” Kneedler agreed, urging the Court to use this case as an opportunity to refocus on the “reasonableness” language within NEPA that binds agencies.
Respondents (Eagle County, Colorado and Center for Biological Diversity et al.)
William Jay, Counsel for Respondents Eagle County, Colorado and Respondent environmental groups, argued that the EIS was not sufficient. He proposed the most expansive of the three tests, stating “when an effect is within the scope of reasonable foreseeability and within the agency’s authority to consider, Congress doesn’t direct agencies to pass the buck to someone else.”
Justices’ Response:
Justices Jackson and Kagan asked Eagle County and Respondent environmental groups’ counsel several times to explain why an agency should consider effects that the agency does not have the power to prevent. Specifically, Justice Kagan asked whether STB could deny the proposed rail line based on the fact that it doesn’t like pollution, since the rail line would result in increased pollution due to the transported crude oil’s eventual refinement. Justices Jackson and Kagan drew on the Interstate Commerce Act’s “common carrier” mandate which prohibits STB from discriminating based on what gets carried on the rail lines it approves. Mr. Jay responded that an agency may not be able to deny the rail line based on these grounds, but that NEPA still requires it to gather public input on and consider all reasonably foreseeable effects in making its ultimate decision.
Takeaway
The parties were allotted a total time of 1 hour to argue, which was well surpassed as a result of the justices’ numerous questions. The considerable back and forth in hammering out the arguments is an indication of the justices’ interest in the case and the significance of its potential impact. Overall, the justices seemed to appreciate arguments that more restrictive NEPA reviews and less interference by courts would align with recent amendments to NEPA called the “BUILDER Act,” which are meant to streamline NEPA reviews.
To make matters even more interesting, Justice Gorsuch recused himself from the case due to potential conflicts of interest. A majority of the resulting eight-member panel could choose to adopt one of the parties’ proposed “reasonably foreseeable” tests, or choose to chart its own course and curate its own test. In any case, a new era of NEPA could be imminent. Of course, with an eight-member panel, the case could result in a 4-4 split decision.
Notably, there was no discussion during the argument of a recent decision by the D.C. Circuit which raised questions as to the validity of NEPA regulations, the same regulations that STB relied on for its environmental assessment in Seven County.
We can expect a decision from the Court by the end of its term in June 2025. LLW will continue to provide updates and insights as they arise.