Going Deeper on NEPA, with J. B. Ruhl

Notable Quotes

• How NEPA lawsuits work: “If an agency fails to carry out NEPA faithfully or accurately, then opponents, or people who object … can bring an action in federal court, and that has led to an extensive body of case law interpreting NEPA.” (4:35)
• New restrictions on “cumulative impact” litigation: “Probably the most concerning aspect of [the Trump administration's proposal] as far as, say, environmental interests go, would be the de-emphasis of cumulative impacts … If we’re authorizing the removal of a small amount of a species habitat on a project, that might not amount to very much, but if there are a thousand such projects, that might amount to a cumulative impact.” (17:44)
• Legal ambiguities at the heart of NEPA: “So when people ask, “What does NEPA require?”, there’s never an easy answer, in the sense that it’s always an amalgam of the statute, the regulations, and court opinions, and we haven’t had regulatory changes in quite a while … So, we’re at a juncture where if these [proposed] rules are finalized, we will have to reevaluate what exactly case law requires and doesn’t require, and whether or not those regulations can actually go forward.” (24:59)

Top of the Stack

• Guns, Germs, and Steel by Jared Diamond
• Boomtown podcast by Texas Monthly

The Full Transcript

Daniel Raimi: Hello and welcome to Resources Radio, a weekly podcast from Resources for the Future. I'm your host, Daniel Raimi.

This week we talk with Professor J.B. Ruhl, David Daniels Allen Distinguished Chair of Law, Director of the Program on Law and Innovation, and Co-director of the Energy, Environment and Land Use Program at Vanderbilt University.

J.B. is an expert on environmental, natural resources, and property law, and we'll talk to him today about the National Environmental Policy Act, or NEPA. We'll talk about what NEPA does, what it doesn't do, and the recent changes proposed by the Trump administration. Stay with us.

Okay, J.B. Ruhl from Vanderbilt University in beautiful and enjoyable Nashville, Tennessee. Thank you so much for joining us today on Resources Radio.

J.B. Ruhl: Oh, it's my pleasure. Thank you for having me.

Daniel Raimi: Yeah. So we are going to talk, J.B., today about NEPA, the National Environmental Policy Act, but before we do so, could you give us a little bit of background on how you ended up working on environmental issues, and particularly in a legal context?

J.B. Ruhl: Well, sure. It's actually a very haphazard, random path. I didn't decide to be an environmental lawyer when I was in kindergarten. As an undergraduate at the University of Virginia, I was an economics major, but I explored other topics and I took a couple of environmental science classes. I then went to law school, but at the time I went to the University of Virginia as well, there was no environmental law class, there was barely environmental law. I'm dating myself, but, it wasn't really until I graduated and started working at a law firm in Washington, DC, I decided to get an LLM at night at George Washington University. I was not intent on any particular subject area, but I started taking environmental law classes and it sort of snowballed from there.

I really liked the classes, and this was in the early 80s when environmental law was really becoming a big field of practice for companies and law firms. I knew the acronyms, I knew what everything sort of meant more than anyone else in the office, so as environmental work started coming into the office it just got funneled to me, and it went from there and I just continued my interest in it. Eventually that was all I did full time was basically environmental law, particularly of land development.

Daniel Raimi: Great. Speaking of acronyms, you mentioned LLM. What does that stand for?

J.B. Ruhl: I'm sorry. Yes, it's a master's degree. It's the degree after a Juris Doctorate, so it's a specialization degree that ... I don't know what LLM stands for actually, but it's a master's degree basically.

Daniel Raimi: Great. Okay, thanks. So, let's dive into it and talk now about NEPA, which you have lots and lots of experience with. Much more than I, I should say to our listeners that this is pretty much virgin territory for me, so I'll be asking some fundamental questions of J.B. and then we'll get into some more details, particularly about the recently proposed changes from the Trump administration.

But to start off, can you just give us a little bit of history about NEPA? For example, when was it enacted, and particularly what types of problems was it designed to address?

J.B. Ruhl: Sure, and speaking of acronyms, NEPA is the National Environmental Policy Act, but it's just known as NEPA. It was passed in 1969, and it basically was designed to ensure that federal agencies when they are funding or carrying out an activity or approving an activity, kind of check in and assess the impacts to the environment of the activity, and the statute itself is actually pretty bare bones. It doesn't really say much about how this is to be done, [or] what's supposed to be included in this study.

There's one sort of paragraph that has become the centerpiece of NEPA practice, which consists of regulations that are developed by the Council on Environmental Quality, which is part of the Office of the Executive, the White House, and then extensive amounts of case law. Because if an agency fails to carry out NEPA faithfully or accurately, then opponents or people who object, who feel they would be injured by the project and the agency's failure can bring an action in federal court, and that has led to an extensive body of case law interpreting NEPA, applying NEPA. So if one just read the statute, you would really have no idea what's going on under NEPA. And then you read the CEQ regulations, those are the regulations that are being proposed for revision, and you dig a level deeper and then you read the case law and realize there's just so much to NEPA that it's actually quite a complex practice area.

Daniel Raimi: Yeah. Well we'll get into some of those complexities I think over the next couple of minutes. Maybe one other background question first though, which is about the scope of NEPA, and what types of projects it applies to and which it doesn't. I usually hear about NEPA being referenced with regard to large infrastructure projects like interstate highways or long distance oil pipelines. I imagine though, if I wanted to do a home renovation, NEPA probably wouldn't apply it to my home renovation, although maybe it does, I don't know. So, I'm wondering if you can give us some context for thinking about when and where NEPA actually comes into play.

J.B. Ruhl: Sure. So, the statute refers to every recommendation or report on proposals for legislation that an agency makes, and quote "other major federal actions significantly affecting the quality of the human environment." Okay, so that's the world to which NEPA applies.

What does that mean? Well, you have to consult the CEQ regulations, and they define this as actions that the federal government carries out, such as building a post office; funds, so funding of interstate highways; or approves, so that would be approval of a permit, say for the Corps of Engineers to fill wetlands or other federal permits, authorizations.

So the starting point is basically anything federal agencies do, very broadly, and there are some exceptions—some of which are kind of complicated, but some of which seem pretty obvious. So for example, if the agency has no discretion, it has to do X. Congress has said, "Agency, go do this. Period." NEPA does not apply, because there's no point to assessing the environmental impact because the assessment couldn't influence the decision. There is no decision. And, NEPA does not apply to the president directly. In other words, if the president takes some action and not through an agency, the president is not an agency. It doesn't apply to states and local governments and private actors directly, but it does apply to them if they're seeking federal funding or if they're seeking federal approval.

So, you start to narrow it down from the very broad idea of anything an agency does. Agencies also are allowed to categorically exclude certain activities that would clearly not rise to any meaningful environmental impact. So there are categorical exclusions for, well for example, one that's sort of been in the news lately is the FCC, Federal Communications Commission, has issued a categorical exclusion for satellites, and now there are so many satellites in the sky people are sort of pushing back on that and suggesting that the FCC should subject satellite launches to NEPA, satellite approvals to NEPA. So, there are ways to keep things out of NEPA, but those can be controversial.

Daniel Raimi: Right. So, I guess one question that I had was if we think historically, and not referring to the recent proposed changes from the administration, but if we think historically, what types of impacts and environmental effects has NEPA required agencies to account for in their approvals or their own activities? For example, how has NEPA required agencies to account for the impacts that might occur some distance from the project itself? So, if we think about an oil pipeline that requires some kind of federal approval, I could easily imagine that the construction of a new oil pipeline would lead to more oil wells being drilled in the oil field where the pipeline originates, but does NEPA cover that type of induced or kind of indirect activity, or is it only the direct effects of the project itself?

J.B. Ruhl: Well, that's a great question, but let me back up first before I address that just so we're clear about one thing. Through a series of the United States Supreme Court opinions interpreting NEPA, it's clear that NEPA is purely a procedural statute. So in other words, when you ask what do they have to account for, they have to describe impacts, they have to describe alternatives to their proposed action, but it doesn't matter whether their proposed action has impacts or whether an alternative will be less impact to the environment. There's no substantive component to NEPA. There's nothing that says “once you do this assessment, your decision has to be the least environmentally intrusive or you have to do things to change the project”. So when you say account for, I just want to be clear that it's really just a procedural accounting.

As to your question, what impacts? So again, the statute does not tell us the answer to that question. So the CEQ has, for decades, had regulations in place that divide the world into three kinds of impacts: direct, indirect, and cumulative.

So let's take your example of a highway or a pipeline. The direct effects are the highway or the pipeline, right? The pipeline is going to go through a right-of-way. It'll require taking land, chopping down trees, clearing an area, digging a hole perhaps, or or a trench. Those are the direct effects.

Then the indirect effects are a little squishier, as you suggested. Well, what about downstream impacts? If we build this pipeline and it goes to point X, well, oil has to go in the pipeline or natural gas, so will this induce more drilling? Will this induce more development? So, these are the indirect, usually they're defined as distant in time or space. So in other words, they're happening not where the direct impacts are happening, or maybe later. So, a highway might induce a development, a highway is used and that might lead to oil runoff. Those are indirect effects.

Cumulative effects are effects of many, many, perhaps even small projects building up over time. And so one has to ask, "Well yeah, this project doesn't seem to have much impact, but if we're approving or funding 10,000 of them, how do we account for those cumulative effects?" This is one area where the proposed rules are changing the way we think of that.

Daniel Raimi: Right. To maybe circle back to your preface in answering that question, just to make sure I understand this and our audience understands it, when an agency carries out a NEPA review, there's no requirement at the end of the review if they find one thing or another, that doesn't mean that they have to require the developer to proceed in a certain way. Is that correct?

J.B. Ruhl: That's correct. Under NEPA, that's right. There may be incentives to reduce impacts, because the way CEQ designed this whole process of conducting an assessment, it's several stages of decision making as to how far to go with the assessment. So let's say you have a project. The first thing you would do if you're not sure what the impacts are is conduct an environmental assessment. That's kind of a quick—you're not going to go out researching everything or studying everything about the project— just kind of make a first cut at, does this look like it's going to have significant impacts on the environment? If the answer is no, then the agency will issue what's called a “Finding of No Significant Impact,” or a FONSI.

Daniel Raimi: That's definitely our acronym of the day, a FONSI.

J.B. Ruhl: Yes, that has certainly led to many chuckles. So, a FONSI is a good thing for the agency or the developer or anyone who needs money or approval from the federal agency, because that's the end of the process. Now, what that has led to is in some cases a project initial design might then, if you're thinking, "Well, this looks like it's going to have significant impact," it might lead to changes in the project design or what's called mitigation, which means offsetting the impacts with some improvements. So we might be affecting wetlands here, but we're going to improve wetlands over there. Something like that. That can allow you to, it's called mitigating to a FONSI, and then you avoid the big study, what's called the Environmental Impact Statement. That's the big study. It takes years, lots of procedure, lots of rigmarole.

So, there has been some impact from NEPA in terms of reducing impacts, but it's mainly through the incentives that the process presents for avoiding doing the full blown Environmental Impact Statement. It's again, as you accurately summarized, there is no substantive demand that NEPA ever makes.

Daniel Raimi: Got it. That's really helpful, and it answers sort of a fundamental question that I've always had about NEPA, so this has been really useful for me already.

Turning now to the Trump administration's proposed changes to NEPA. Can you talk a little bit about what those proposed changes are and how significant they might be? There's this term that's used in the background meetings that I did where agencies are only asked to include effects that are reasonably foreseeable, which seems like an important phrase, but maybe there are other important phrases that you want to point out and sort of talk us through.

J.B. Ruhl: Well, yeah. Let me point out first that what's happening under NEPA has some parallels to what's happening under the new rules that the Trump administration passed under the Endangered Species Act, which also includes a kind of impact study. It's called the consultation on the impacts to species, and that process has also divided the world into direct and indirect effects. The way in which CEQ, Counsel on Environmental Quality, under NEPA and also the agencies that implement the Endangered Species Act—you can't just sit around and speculate about impacts, right? You have to have some grounding as to which impacts really do we need to consider, and they've generally used this kind of reasonably foreseeable proximate cause kind of analysis, so we want agencies to consider impacts that this project is actually causing and which are reasonably foreseeable.

The CEQ used those words to help us understand which indirect and direct impacts need to be considered. So, one argument is that this change is just kind of collapsing or doing away with this distinction between direct and indirect, and saying “Just consider all the effects that are reasonably foreseeable, and [of] which the project is a causal force.” And so, in that sense it's not really that radical. You can argue it's not making much of a change and perhaps it's simplifying the way we undertake this impact analysis. What it does though is the proposal's also essentially eliminating the idea of cumulative impacts, because your project isn't the cause of some other projects’ impacts. So probably the most concerning aspect of the proposal as far as, say, environmental interest groups, would be the deemphasis of cumulative impacts such as, again if we're authorizing the removal of a small amount of a species habitat on a project, that might not amount to very much, but if there's a thousand such projects that might amount to a cumulative impact.

I think if NEPA has done anything, well it's done quite a lot of course, but I think the most important contribution NEPA has made to environmental law and policy has been to really focus our attention on cumulative impacts, the need to keep them under assessment. That doesn't mean that NEPA requires that we do anything about them, but NEPA I think has really helped us understand that just because this project doesn't have significant effects on a particular resource doesn't mean that a hundred others won't add up to a significant effect, and these proposals would sharply undercut that kind of analysis.

Daniel Raimi: Right. Yeah, that's really clear. I guess one additional sort of cut at this question looks less at the environmental effects that we might see on a stream or on a wetland or on a habitat, but instead effects in terms of greenhouse gas emissions. So can you talk a little bit about to what extent NEPA currently requires accounting for greenhouse gas emissions? Either direct, indirect, cumulative, and how the administration has proposed change where we're just thinking about reasonably foreseeable, how that would affect any accounting or consideration of greenhouse gas emissions at different phases of the project.

J.B. Ruhl: Sure, and this question actually goes back to policy developments over the past decade really. So, the Obama administration developed a policy—not a regulation, but policy—defining how agencies should consider greenhouse gas emissions, and focused both on the impacts, the emissions from the project itself, and they kind of set a threshold of how many thousands of tons a project would need to emit before it would be in the zone of NEPA environmental impact statement analysis. They included in that both the direct and then the indirect downstream or inducement effects. They also, in that policy, required agencies to consider the effects of climate change on the project. So in other words, if you're designing a coastal project, should you take into account sea level rise?

That policy was rescinded by the Trump administration through a presidential memorandum. It had been adopted by the Obama administration actually as a presidential memorandum, so no agency was involved. Obama just signed a policy document, and then Trump rescinded it along with others through an executive order actually. It's kind of the same thing.

So, those were both presidential actions, and so when Trump rescinded that, again the sort of law of NEPA said, well what does NEPA require? Well, you also have to look at courts, and courts have interpreted NEPA to require essentially what President Obama in his presidential memorandum required. These regulations are essentially, now as a matter of regulation and not just policy, are really [saying,] although not saying it directly, you don't have to consider greenhouse gas emissions because any one project is such a small contributor and the cumulative effects are really global, so how could you consider projects going on in China and Japan?

Daniel Raimi: Right.

J.B. Ruhl: Yeah. So basically, they're backing NEPA out of greenhouse gas emissions pretty clearly.

Daniel Raimi: Okay. Yeah, that's definitely part of the decisionmaking that has received some of the most attention that I've seen. In particular, this question around not considering future climate impacts when designing infrastructure.

J.B. Ruhl: Right.

Daniel Raimi: That’s pretty surprising, to me at least. So, one additional question, which is kind of a legal question, I think. It's about the language that's included in the proposal. So the wording that I saw often used the phrase “need not,” as in an agency need not include detailed analysis of greenhouse gas emissions. But that phrase, need not, doesn't seem to prevent agencies from doing greenhouse gas analysis or some other additional analyses. So if these changes go into effect, or when they go into effect, could a future administration basically leave them unchanged and yet still choose to do additional greenhouse gas or other types of analyses if they thought it was appropriate?

J.B. Ruhl: I think the answer to that is yes. I mean, frankly we don't have clear answers to some of your questions because it's just an area that's in so much flux, and the reality, as well, is that the court opinions that have addressed greenhouse gas emissions and climate change, they're still on the books. So, one challenge that I would imagine would come out of any finalization of these rules would be to say, "Well, the courts have said that you have to consider greenhouse gas emissions and downstream effects and the effects of climate change on the project, so your regulations are inconsistent with court interpretations of the statute." We'll actually really have to go back and determine what exactly were the courts interpreting? Were they interpreting regulations, statute?

So it's a real mess, to tell you the truth Daniel. It's a lawyer's heaven because we're going to have so many lawsuits over what exactly happens when a set of regulations comes out that changes the framework, the wording, obviously the requirements, and we have a body of case law that's decades-old that was based on the very sparse statute and CEQ regulations, and sort of just the logic of judicial reasoning in terms of statutory and regulatory interpretation.

So, when people ask, "What does NEPA require?", there's never an easy answer in the sense that it's always an amalgam of the statute, the regulations, and court opinions, and we haven't had regulatory changes in quite a while. CEQ has issued policy guidance like the one I mentioned the Obama administration did. So, we're at a juncture where if these rules are finalized we will have to kind of reevaluate what exactly case law requires and doesn't require, and whether or not these regulations can actually go forward, on the reasoning that the court opinions really weren't interpreting NEPA, they were just interpreting CEQ and agency practice.

Daniel Raimi: Right. Got it. So, along with streamlining environmental reviews, it's a jobs program for lawyers.

J.B. Ruhl: Well, maybe.

Daniel Raimi: So, last question now J.B., before we go to our Top of the Stack segment, which is in the background meeting I was doing before this conversation, several commentators, I don't know if speculated is the right word, but they seemed to suggest that the changes proposed here underneath or by the Trump administration were particularly focused on making things easier for long distance oil and natural gas pipeline construction. Do you see that as a ... I don't know, is there much grounding to support that statement, or is that just kind of people speculating about the motives of the administration?

J.B. Ruhl: Well, I don't have any direct insights to the motives of the administration. I think it's probably a fair assessment. All linear projects are extremely complicated under NEPA. So you say a pipeline, right? You might have a pipeline that's 400 miles long. Well, there's no federal funding for the pipeline. The federal government is not approving it, let's say. Right? A natural gas pipeline. So, where's the NEPA nexus? The nexus generally is crossings of streams, and that implicates the Corps of Engineers, which implements Section 404 of the Clean Water Act. So, there might only be four stream crossings in 400 miles and they're each 10 feet wide.

So, what is NEPA supposed to do with that? We can get really now into the weeds of NEPA, but I think that part of this is—yes, I agree that they're trying to reduce the NEPA burden on … this will reduce the NEPA burden on linear projects, and in particular, certain kinds of pipelines that are not approved by the federal government, other projects that don't require federal approval necessarily. Wind farms, solar arrays —if they're not on public lands [they] might not have any federal approval required, but they might have a ... If they have [what]'s called a small handle problem, Daniel. It's—what do you do when the NEPA nexus to a project is just a one stream crossing out of a hundred miles? Does this small handle mean that NEPA applies to the whole project, or just to that little area, right? This has been going on, this small handle issue and the resolution of it has been sort of a NEPA issue for decades.

Daniel Raimi: That's so interesting. Well J.B., I get the feeling that I could ask you several hundred more questions about NEPA and we still won't be getting to the bottom of it, but this has been a really great sort of primer on the topic, and particularly about the proposed changes. So, thank you so much for taking the time to spend your time with us and share your expertise.

J.B. Ruhl: Sure.

Daniel Raimi: I want to close this out by asking you the same question that we ask all our guests, which is what's on the top of your literal or metaphorical reading stack? So, something you've read or watched or heard lately that you've really enjoyed relating to the environment.

And I will briefly just recommend a new podcast that I discovered, so as soon as you're done listening every week, of course, to your Resources podcast, you can check out this new one that's called Boomtown. It's a very different subject from what we've covered today, but it's all about the Permian Basin in West Texas and New Mexico, and it talks about the history of the Permian Basin as well as some really great reporting and storytelling about what's happening there now, which is this historic boom in oil production out there in the Permian. So, I really recommend it. It's from Texas Monthly, and the podcast is called Boomtown.

So how about you J.B.? What's on the top of your stack?

J.B. Ruhl: I have admit I spend all day at work thinking about environmental law and policy, so I don't necessarily rush home to read more environmental law and policy.

Daniel Raimi: I feel you.

J.B. Ruhl: But what I'm reading right now is, I'm actually going back and starting a book I started years ago and didn't finish. Not because I didn't enjoy it, I probably just got sidetracked. Guns, Germs, and Steel by Jared Diamond. The reason I'm interested—perhaps it's because of my growing interest in climate change adaptation. The thesis of that book is that environmental conditions have much explanatory power for understanding how civilizations that were all sort of hunter-gatherers around the world in 11,000 BC diverged, in terms of technological and other features. I think we're at a point where environmental change is going to, because of climate change, once again kind of separate north and south, east and west, whatever you want to call it in developing-developed worlds, in ways that could for millennia and millennia, even if we solve climate change, sort of lock in disparities that have lasting social and cultural implications.

So, I'm going to go back and reread that. I'm already into it, and just kind of see what I can learn from that for purposes of thinking about our future of environmental change.

Daniel Raimi: Yeah, that makes a lot of sense. I haven't read that book, but it sounds like there certainly would be connections to make there.

Great. Well thank you so much, J.B., for sharing those recommendations, and for again, sharing your expertise on NEPA. We really appreciate your time, and thanks for joining us on Resources Radio.

J.B. Ruhl: Oh, it's my pleasure. I'm glad to have reconnected with you, Daniel, and I'm very honored to be part of your podcast.

Daniel Raimi: Thank you very much.

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