D.C. Circuit Finds Council on Environmental Quality's NEPA Regulations Are Unenforceable
In Marin Audubon Society v. FAA, the D.C. Circuit held the White House Council on Environmental Quality ("CEQ") lacks authority to issue binding regulations under the National Environmental Policy Act ("NEPA").
On November 12, 2024, the United States Court of Appeals for the D.C. Circuit, in Marin Audubon Society v. FAA, vacated an air tour management plan issued by the Federal Aviation Administration and National Parks Service (together, the "Agencies") that governed tourist flight operations over four national parks near San Francisco, California. Under NEPA, federal agencies must assess the environmental impact and potential adverse effects of a proposed action. The CEQ, a body created by NEPA in 1969, promulgated regulations governing these assessments, including providing for "categorical exclusions" for certain actions identified by an agency to have no significant environmental effects. These regulations, first published in 1978, have formed the long-standing basis for reviews of federal agency actions under NEPA.
In a rebuke to this framework, the majority of the three-judge Marin Audubon Society panel held that CEQ's long-standing regulations exceeded the Council's authority because NEPA contains no statutory language suggesting Congress empowered CEQ to "act as a regulatory agency rather than as an advisory agency," and no statute confers rulemaking authority on CEQ. Neither party raised this question to the court, which relied on its "'independent power to identify and apply the proper construction of governing law'" and noted that both sides "took for granted CEQ's authority to issue binding NEPA regulations."
Although the court unanimously agreed that the Agencies acted arbitrarily and capriciously by "treat[ing] the existing air tours in the parks as the status quo for purposes of conducting their NEPA analysis" and remanded the case, the court's holding on the validity of CEQ's regulations is more noteworthy because it reflects another shift in the judiciary's treatment of the administrative state. As Senior Circuit Judge Randolph explained, prior Supreme Court decisions stating CEQ's regulations under NEPA are "entitled to substantial deference" cannot be credited in light of Loper Bright Enterprises v. Raimondo.
Looking forward, other agency NEPA regulations and orders based on CEQ regulations are at risk of being vacated, and entities that seek to challenge NEPA agency reviews now have another arrow in the quiver. Entities seeking or who may need to seek approvals from federal agencies requiring NEPA review should monitor how specific agencies address the impact of this decision on their own regulations moving forward as well as consider how the decision could be used to push back on agency decisions regarding NEPA reviews.
