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Background

The Council on Environmental Quality (CEQ) published an interim final rule (Rule) in the Federal Register that removes its regulations implementing the National Environmental Policy Act (NEPA) at 40 CFR § 1500 et seq., effective April 11, 2025. CEQ seeks comments on the Rule to inform its decision process, due March 27, 2025.

NEPA is a landmark environmental law that requires federal agencies to assess the environmental impacts of their proposed actions and consider alternatives before making decisions. 

NEPA’s regulations first caught the attention of President Trump during the first Trump administration, where President Trump issued Executive Order Executive Order (EO) 13807 (August 15, 2017) directing the CEQ to make significant changes to the regulations implementing NEPA. Pursuant to EO 13807, the administration directed the CEQ to take several actions, including to determine how to streamline the NEPA process and reduce the time and cost of environmental reviews.  In 2020, the CEQ published a final rule that revised its NEPA regulations for the first time in over 40 years, which included setting time limits for environmental reviews, narrowing the range of actions subject to NEPA, and reducing the consideration of cumulative impacts.

In response, the Biden administration implemented steps to reverse the changes made during the first Trump administration, including many substantive updates published in the May 1, 2024 final rule titled National Environmental Policy Act Implementing Regulations Revisions Phase 2. Additionally, President Biden issued an executive order directing federal agencies to review and revise their NEPA procedures to ensure thorough environmental reviews and robust public participation, including a focus on climate change and environmental justice.   

Now, CEQ’s Rule is the latest attempt by the Trump administration to achieve its policy goal of federal de-regulation. 

Action

President Trump signed EO 14154 on January 20, 2025, which accomplished two key points regarding NEPA: (1) rescinded Executive Order 11991 of May 24, 1977 (Relating to protection and enhancement of environmental quality), which was seen as the authority for CEQ to implement the NEPA regulations, and (2) directed CEQ to rescind the NEPA regulations and provide guidance on implementing NEPA.  EO 14154 further directed agencies to coordinate and implement agency-level NEPA process revisions, and required the guidance to prioritize “efficiency and certainty” over all other objectives.

CEQ also completed its other directive and issued guidance to federal agencies on implementing NEPA’s requirements through a February 19, 2025 memorandum (“CEQ 2025 Guidance”). The CEQ 2025 Guidance requires agencies to revise (or implement) their NEPA procedures consistent with EO 14154, meaning revised agency NEPA procedures will prioritize efficiency and certainty over any other policy objective.  Additionally, the CEQ 2025 Guidance recommends agencies use the 2020 version of the NEPA regulations promulgated during the first Trump administration as a guide for revisions or implementation of an agency’s NEPA procedures.  The CEQ 2025 Guidance recommends considering the following key points in revising or issuing NEPA implementation procedures, among other points:

  • Reasonable Range of Alternatives: When developing an EIS, agencies should, to the extent otherwise required by applicable law, only consider a reasonable range of alternatives to the proposed action that are technically and economically feasible and that meet the purpose and need for the proposed action. The consideration of alternatives should include an analysis of any adverse environmental effects of not implementing the proposed action in the case of a no action alternative to the extent that a no action alternative is feasible.
  • Effects: Federal agencies should analyze the reasonably foreseeable effects of the proposed action consistent with section 102 of NEPA, not cumulative effects
  • Federal Funding: Proposed agency actions with “no or minimal Federal funding” and “loans, loan guarantees, or other forms of financial assistance where a Federal agency does not exercise sufficient control and responsibility over the subsequent use of such financial assistance or the effect of the action” are not “major Federal actions.”
  • Environmental Justice: NEPA documents should not include an environmental justice analysis, to the extent that this approach is consistent with other applicable law.

The 2025 CEQ Guidance further describes points to improve consistency and predictability, like clearly delineating the NEPA review process and stages, establishing guidance and procedure for obtaining and reviewing public comment, identifying actions not subject to NEPA at threshold stages, and additional actions. Supplemental guidance from the CEQ is expected, as the NEPA interagency working group established by EO 14154 will meet monthly. Ultimately, agencies are required to update their NEPA processes within 12 months of the 2025 CEQ Guidance.

Looking Ahead

For projects already in NEPA review, the 2025 CEQ Guidance indicates agencies should follow their current NEPA implementation processes, but in accordance with the directives of EO 14154.  However, there could be differences in agency interpretation on how to implement NEPA, and the 2025 CEQ Guidance indicates following the 2020 version of the NEPA regulations is merely “encouraged.”  The Rule and subsequent changes may also face legal challenges, not only regarding the Rule and related authorities, but also with respect to challenges of agency NEPA decisions if issues are identified during the NEPA review as agencies update their NEPA processes during period of significant staffing reductions.  Additionally, the changes to NEPA yet again could be an early target of future executive or legislative action in the next administration.  Reed Smith is actively tracking developments with respect to NEPA as part of the Trump administration’s ongoing overhaul of federal environmental regulations, should you have any questions regarding these efforts.      

Conclusions

  • The Trump administration is, for a second time, attempting significant changes to federal environmental review of projects
  • Absent a unified regulatory review process, federal agency environmental review may differ amongst agencies  
  • Legal challenges regarding the Trump administration actions and potentially agency decisions under revised or interim processes are anticipated