The National Environmental Policy Act (1970) was passed as a means to inform citizens of the potential environmental consequences of federal projects. The binding language of the statute requires a “responsible official” to prepare an Environmental Impact Statement (EIS) when undertaking “major Federal actions significantly affecting the human environment.” These statements require, inter alia, a listing of the potential environmental impacts of a project, as well as alternative courses of action to the project (including no action). As most businesses would not voluntarily submit to this long and expensive process, citizen suits under the APA’s arbitrary and capricious standard are often required to enforce this provision.
Businesses and environmentalists both recognize that this statute imposes significant burdens of time and expense on project developers, yet contest the ecological and economic outcomes of EIS. Businesses claim that an EIS mainly slows down a project, while environmentalists believe many EISs do not go far enough, as performing an EIS does not require the developer to use the most environmentally friendly course of action.
Yet first, an EIS must be ordered. The current standard requires an EIS when a federal agency can “exercise discretion over the outcome” of a project. In order to include the private action within the scope of the federal action, the federal agency must possess actual power to control the non-federal activity. This includes control over the outcome of the private project.
Most citizen suits regarding this requirement focus on if the project is “federal.” Environmentalists have successfully litigated many cases where previously non-regulated pollution or projects became subject to an EIS because of a limited federal nexus, such as that part of the project required a federal permit. Businesses see these “small handle” cases as creating undue burdens on development. Environmentalists respond that facilitating EIS creation furthers NEPA’s environmental disclosure goal.
The “actual power” and “outcome” language, from a business perspective, implies that NEPA’s EIS requirements should apply to projects substantially run by the federal government. Yet this standard would not further NEPA’s goals for several reasons. First, the majority of federal employees today are contractors. Therefore, even if a federal agency is nominally in charge of a given project, this would not guarantee that it is “run” by official federal employees. Furthermore, courts would reject such a limited EIS requirement. Courts apply the “control and responsibility” test to create a wide definition of “federal.” However, courts do differ on what aspects of a “federal” project are thus subject to an EIS.
The majority of courts limit the scope of an EIS to those aspects of a project that federal action influences- thus, a transmission line project that required a federal permit to cross a river did not imply that the entire transmission line project was subject to EIS reporting requirements. This might also be described as a “dual” standard, where the “scope of federal involvement” and “the significance of the project’s environmental effects” determines whether, and to what degree, an EIS is required. These courts use several different standards to judge how involved the federal government is in a given project. Regardless, the “scope” standard determines how much of the project needs an EIS.
Other courts apply a “unitary” standard, where if the degree of environmental impact of the project requires an EIS, then the entire project must perform one. This standard is arguably more consistent with the broad goals of NEPA, as it will increase citizen awareness of the full extent of potential environmental consequences. The Council on Environmental Quality’s (CEQ, the executive agency that oversees NEPA) regulations also support this approach; these regulations are subject to “substantial deference” by the courts, yet generally remain unaccepted. Finally, the unitary approach limits the possibility of segmentation, whereby “a federal agency [isolates] a project from the project’s impact on the environment.” Courts ought to adopt the unitary standard to further CEQ’s intent, and broader goals of environmental accountability.
NEPA is part of the vast array of environmental legislation, passed in the 1970’s, that demonstrated American commitment to avoiding environmental catastrophes. Statutes such as the Clean Air Act and Clean Water Act have done a great deal for the habitability of our nation’s natural environment, but have largely stagnated over time. NEPA remains dynamic for several reasons. First, negotiating disclosure standards is very fact-specific. Furthermore, our era of big data means NEPA’s informational goals have renewed popular support.
Maintaining NEPA’s purpose, and dynamism, requires a tweak to some courts’ “small handle” standards. Some courts choose to balance disclosure and development as conflicting goals. Yet these are not mutually exclusive. A unitary approach recognizes that a “small handle” project with serious potential environmental consequences must first disclose all of those consequences, not just those that directly implicate the federal government. Otherwise, the federal government is effectively sanctioning a development that it would not undertake itself.
The views and opinions expressed in this blog are those of the authors only and do not reflect the official policy or position of the Michigan Journal of Environmental and Administrative Law or the University of Michigan.
 PL 91-190 §102(2)(C) (1970)
 Joan Drake. “The NEPA Process: What do we need to do and when?” (2007). Citing Sierra Club v. Hodel, 848 F.2d 1068, 1089 (10th Cir. 1988) aff’d in part and overruled in part by Sierra Club v. Lujan, 949 F.2d 362 (10th Cir. 1991); Defenders of Wildlife v. Andrus, 627 F.2d 1238, 1245 (D.C. Cir. 1980).
 Drake. “The NEPA Process.”
 See e.g. Mid-States Coalition for Progress v. Surface Transportation Board, 345 F.3d 520 (8th Cir. 2003).
 Joan Drake. “The NEPA Process: What do we need to do and when?” (2007). Citing Winnebago Tribe v. Ray, 621 F.2d 269 (8th Cir. 1980). http://www.modrall.com/files/1222_the_nepa_process_what_do_we_need_to_do_and_when.pdf.
 Mary Fitzgerald. Small Handles, Big Impacts: When should the National Environmental Policy Act Require an Environmental Impact Statement. 23 B.C. Envt’l Aff. L. Rev. 437, 444 (1996).
 Id. at 449.
 Id. at 445.
 Id. at 446, 441.
 Id. at 447. Citing Minnesota Pub. Interest Research Group v. Butz, 498 F.2d 1314 (8th Cir. 1974).