Loading summary
Transcript69 lines
- [00:00]
Nicholas Bagley
Foreign.
- [00:04]
Santi Ruiz
I'm Santi Ruiz and this is Statecraft. We interview top political appointees and civil servants about how they achieved a specific policy goal. You can find the transcript for this conversation and many others at www.statecraft.pub. today we're diving into everyone's favorite Statecraft topic, administrative law. Wiwit, before you tune us out, give us a chance. The two court cases we're discussing could have huge ramifications for how we build things in America. To discuss the topic, we brought together three of our favorite administrative law professors for an Admin law party. Talking to them felt like opening the door to the faculty break room and overhearing today's gossip. Do they agree on everything? No, as you'll see. Some brief intros Nicholas Bagley is a professor at the University of Michigan and was chief general counsel to Michigan Governor Gretchen Whitmer. Nicholas recently joined Statecraft to discuss how bureaucracy is breaking government. And during that episode we discussed a law review article he wrote called the Procedure Fetish about the problems with the procedures we've created for federal agencies. James Coleman is a professor at the University of Minnesota specializing in energy infrastructure. He's testified before Congress on how to speed up energy infrastructure permits. Finally, Adam White is the executive director of the Gray center for the Study of the Administrative State at George Mason University. He's practiced constitutional and regulatory law in D.C. with a special focus on energy full disclosure. Several years ago we were colleagues at the American Enterprise Institute, or AEI for short. Thank you all for joining. We're going to be talking about a recent case before the D.C. circuit Court of Appeals, but I think the conversation will go a lot of places from there. So the case is Marin Audubon Society v. The faa. Before we get into the specific ruling in the case, will you explain what the questions at stake were in Marin Audubon Society?
- [01:56]
James Coleman
Yeah, and it's a question that has been perhaps implicit for a long time. Maybe maybe over 50 years. So the National Environmental Policy act is the United States principal environmental review law. The office is the National Environmental Policy act of 1969, but it signed in January 1, 1970. So it's been in place for over 50 years. And it just provides that the government is supposed to consider the environmental consequences of any project that it permits or funds. So any is or major federal action. Now that law has developed over time to require more and more review. At the time that it was passed, it was supposed to be relatively simple. Look before you leap kind of statute and keep in mind it was passed in the context that the United States had undergone tremendous growth after the end of World War II and built really most of the infrastructure that we still rely on to this day. So if you look at the US Interstates we use, most of them were built in that 25 year post war period. If you look at the crude oil pipelines that we still use to this day, most of them were built again they're more than 50 years old on average. So most of them were built in that post war period. And all of that construction had often had impacts on sort of the local communities that went through. So you know, just an example, my grandmother grew up in a prominently African American neighborhood in St. Paul called the Rondo neighborhood. Very famously was the bulldoze to bring Ina through the middle of St. Paul. And so there was this concern that there had been an impact on your local communities. And to address that, the idea was, well, we need some kind of look before we leap statute that says the federal government has to consider these environmental impacts before it goes forward. Now, over time, with a series of decisions in the season into the 80s, the federal courts dramatically expanded what was required under the National Environmental Policy Act. Environmental groups found that this was an amazing tool to potentially stop new infrastructure projects. Because if there the federal government had, according to the courts, not considered some environmental issue to the extent that the courts thought it should be considered, the court would issue an injunction and stop the whole project from going forward. That could delay a project for years. Not only would, you know, it have to wait for its initial environmental review, it would then be stopped by the courts and have to wait for the federal government to fix it for that to be fixed by the court. So over time it just took longer and longer. And then the federal government, concerned about that time started to take longer and longer with those reviews. So were initially done in a matter of months, but eventually took over five years on average.
- [04:41]
Santi Ruiz
And to, and to clarify if I'm as a private citizen or as a, as a nonprofit, I could point to the NEPA review that your agency did. And even though I'm not the owner of the land that's being built on, I'm a concerned citizen, I could bring case under nepa.
- [04:59]
James Coleman
You know, there still is a standing requirement so that, you know, that means that you have to show some kind of, some kind of injury, but that injury could be, you know, one to some environmental benefit you enjoy, you know, bird watching in these woods or other otherwise. So it could be. And those standard requirements are typically relaxed in the context of these Kind of procedural statutes. The idea is, well, no, Congress wanted everybody to be able to take advantage of asking for more consideration of these issues. And so the courts have been relatively generous in that context. Keep in mind that even as the federal courts, by which I mean mostly district courts and federal courts of appeals, have been very generous in interpreting this statute to benefit people that want to stop infrastructure projects, the US Supreme Court has only taken 17 cases and it's about to tomorrow hear another case, the National Environmental Policy Act. But you know, that's only about one case every three years. Really less than one case every three years. So there's been hundreds of national environmental policy cases every year in the lower courts that tend to interpret it very broadly, whereas the Supreme Court, in every decision, the federal government has won. So basically the Supreme Court has said the federal government did plenty of review here. And in fact, in many of those decisions, most of which were unanimous, the Supreme Court has said lower courts knock it off, stop requiring so much from the, from the federal government. We need some of these projects to go through. There's been a little bit of a disconnect between the way the National Environmental Policy act is generally interpreted very broadly, very aggressively in the district courts and circuit courts, and the way it's been interpreted by the Supreme Court, which is probably more reasonable in aligns with the original intent of the law, which was, you know, just to provide some environmental consideration before a project went forward.
- [06:48]
Santi Ruiz
What's the layman's explanation for why lower courts have been so much more generous with their reading of the law than scotus?
- [06:54]
James Coleman
If you read those early decisions, they're very clear that they want to implement the policy of the National Environmental Policy act, which they say, you know, is designed to be protective. And in fact, if you go back and read that National Environmental Policy act, you know, there are almost anti civilization parts of it in the actual, you know, in the actual text of the act, where it seems to be, have some concern with, you know, human population and growth, which is over time, that's just in the sort of background findings of the, of the law. But the Court seemed to want to very aggressively interpret that. And that's partly about a disconnect that sort of opened up between the Supreme Court, which was focusing during that time period more and more on ideas like textualism and limiting to, you know, what the, what the law actually said, and the lower courts, which were still inspired by the supreme court in the 80s and 60s, focusing more on the statute's purpose and trying to implement that purpose by very broadly interpreting the National Environmental Policy Act.
- [07:58]
Santi Ruiz
Adam, let me ask you to explain the Council on Environmental Quality and how that body, the ceq, came up in this recent case.
- [08:08]
Adam White
Well, sure, and I just want to commend James on his intro that I think one of the key themes we'll turn to throughout this conversation is it's a very difficult balance. The NEPA tries to strike. The NEPA's creators, including one of my all time favorite senators, Scoop Jackson of Washington, they tried to strike and the policymakers try to strike now. I thought James's introduction was very evenhanded. The Council on Environmental Quality is very broadly speaking part of the White House. I think it's actually across the street. It's a nice little townhouse office in Lafayette Square in Washington D.C. but the council on Environmental Quality has been the White House unit that's been responsible for implementing NEPA for a long time. I'm not actually sure when it came into existence, but I've been working on these issues ever since I was an energy lawyer 20 years ago, and I know CEQ long predated that. Crux of the, of the case in the D.C. circuit is that CEQ's power really is not a function of statute, at least not in terms of administering nepa. It really is a function of, of executive order, in the sense that of executive order gave the SEQ its operative power to create binding rules. One of my colleagues on the podcast pointed out, yes, it was created by NEPA itself, that's true. But in terms of its power to create the rules governing the implementation of NEPA by the agencies, that's the product of a, of an executive order. I think it's important to put CEQ's founding in the context of its time in the mid to late 20th century, right into the 1960s and 1970s. You saw not just the rise of broad cross agency environmental statutes, nepa, the Clean Water Act, Clean Air Act, Coastal Zone Management Act. You also saw a building out of the White House structure, partly by the White House itself and partly by Congress. You saw at the same, around the same time as CEQ being created in 1969, 1970. You saw the rise of the Office of Management and Budget, which had roots way back into the FDR administration, but it really sort of comes into its modern form in the second half of the 20th century. You saw the White House over the decades that followed building out or refining things like, well, later the Office of Information Regulatory affairs and things like the National Security Council. After World War II, the National Economic Council. CEQ is not quite the same as those. It is again, you know, in its origin a creature of statute when NEPA itself was created. But you've seen its form and function change over time as more and more authority was layered onto it, both formally through things like executive orders, but also just informally sometimes the, the office holder, somebody running CEQ might have more power. I know, I remember during the Obama administrations when you had the blackouts and was it New York, Brooklyn, you had the Sweden blackouts, suddenly had CEQ very much in the middle of the response to that, just trying to help keep the lights on. But I think above all with the rise of climate change as a major policy subject, CEQ's authority and its influence has really grown only exponentially, partly because of its cross agency power and partly because of its literal and legal proximity to the presidency.
- [11:28]
Santi Ruiz
Will you just explain for me, up until this case Marin Audubon Society, which has kind of thrown CEQ's role into, into question up until this point, what has CEQ's managerial or oversight function been of other agencies?
- [11:42]
Adam White
Well, I mean formally I'd say twofold. One is the promulgation of regulations implementing NEPA. In the first instance, administration wide downstream of that, NEPA has from time to time promulgated guidance or sometimes draft guidance trying to further explain and refine the application of NEPA and the NEPA regs in particular contexts, especially in climate. And so nepa, that's, that's what I would consider its most important powers. Although again a lot of it is the soft power of having a centralized sort of traffic cop on these issues so close to the, to the presidency. That's how I think of it.
- [12:21]
Santi Ruiz
Can you give me an example of how I'm at work? Let's say I'm in an agency working on some major action in your ceq. Talk me through that dynamic.
- [12:30]
Adam White
Well, Nick actually served in government where I just sit outside and complain. But I do want it, since I mentioned oira, I want to maybe distinguish CEQ a little bit. As I understand it, CEQ is not as directly related in nearly as many specific concrete agency actions before. I mean nepa, as James sort of explained earlier, NEPA applies anytime an agency wants to do anything that could have a major impact, a reasonably foreseeable impact on the environment or when the agency is granting or denying a permit for private infrastructure projects so that can have those environmental impacts. So I understand that CEQ does not actually dig into every specific application the way that oira, say gets involved in or has tacit authority over so many discrete regulatory actions by the agencies. CEQ's role has been much more at the across the board lawmaking level, when it is creating regulations, when it's proposing guidance documents that will inform all agencies work. But I don't think it gets deeply involved in discrete infrastructure issues. I'm sure there's exceptions, but my understanding of a CEQ is that it is more of a planning body, planning the broad regulatory process and not diving into concrete permitting decisions.
- [13:58]
Santi Ruiz
Nick, want to kick up the ball here?
- [13:59]
Nicholas Bagley
Yeah. I mean, Adam has it exactly right. They're setting the rules of the road. And Starting in about 1977, CEQ started to issue those rules of the road through what we call in administrative law circles, through what we call legislative rules. What that means is just that the guidance that the office issued would go through notice and comment, and it would be published in the Federal Register. And that gave it sort of a veneer of formality. These rules looked not just like, hey, this is how CEQ thinks about nepa. You know, agencies take that into account when you act. Now, these rules were formally binding on agencies. And the big step is that courts for many years saw them as effectively binding the agencies as well and as enforceable in court. So CEQ regulations have grown increasingly complex over time. They require, among other things, notice and comment, extensive regulation, analysis of alternatives. They lay out a bunch of categorical exemptions. They're also used to advance the sitting administration's priorities. So under the Biden administration, for example, CEQ regulations have required agencies to take into account environmental justice and indigenous knowledge. And so CEQ has been blamed for contributing to the punitive length of environmental impact statements, which are now many hundreds of pages long and, as James said, take many years to complete. Whether CEQ is, in fact the primary driver of most of the sort of NEPA work that we see agencies doing is, is. Is contested, but they certainly contributed to the burdens.
- [15:38]
Adam White
CEQ isn't the only agency that's making regulations under nepa. Right? So say ferc, James Coleman's favorite federal agency, ferc, the Federal Energy Regulatory Commission, the agency that's responsible for not just regulating electricity markets, but, more importantly for this conversation, regulating interstate natural gas pipelines, certain interstate electricity corridors, things like that. FERC has its own body of regulations implementing NEPA at an even more granular level, obviously much more tailored towards FERC's substantive jurisdiction. So FERC. So CEQ is not the only one making these regulations. The other agencies, the Army Corps of Engineers and others have their own body of NEPA regs.
- [16:19]
Santi Ruiz
So any federal agency that's dealing with NEPA has its own internal regulatory system that it's working through as well as this kind of theoretically binding CEQ framework. Right.
- [16:31]
Nicholas Bagley
I'll turn that up a ratchet. When it comes to if you're an executive branch agency, the CEQ regulations are not theoretically binding. They are binding on you. Just as a matter of executive branch internal governance. It's when the White House says to all of its agencies, we want you to do X, Y, or Z, well, that's a. That's a direct order from the president. And if you serve at the pleasure of the president, you follow through on that. And that's true whether or not these CEQ regulations are legislative rules that apply in the courts. And this is an important.
- [17:01]
Santi Ruiz
Explain that for us, because I think most of us listeners who are not lawyers will be very confused by that particular sentence.
- [17:07]
Nicholas Bagley
Yeah. So this is. This is one of the things you have to really try to wrap your head around. So one of the reasons that NEPA has become so fearsome is because it is enforceable in the courts. So what happens usually is that some kind of environmental group, for example, will sue an agency that's trying to get a development off the ground. And they will say that the agency has failed to consider an alternative that would have mitigated the environmental consequences, or that the agency has failed to examine one of those alternatives deeply enough. And if a court agrees that the agency has failed to take into account an important aspect of the problem, the court will blow up the agency action and send the agency back to the drawing board. And that can be immensely disruptive to what an agency wants to do. And so in response to that, agencies spend a lot of time trying to kind of COVID their butts, trying to make sure that they can withstand eventual court review. So the issue that we're sort of talking about in connection with this Marin county case that kind of brought us together today is whether the CEQ regulations are binding in court. And what I mean by that is that when environmental groups bring these lawsuits, one of the things that they sometimes do is say, look, the agency failed to abide by the CEQ regulations. They didn't adhere to what they require. And that is part of the reason we think that their action should be stopped. Because those CEQ regulations are on the books and because they look pretty formal, courts have, over the past 45 years or so, looked at those and said, hey, we can enforce those CEQ regulations. They're they're regulations, after all. And the issue in the Marin county case is, is that an appropriate rule for the courts? Is it appropriate for the courts to enforce the CEQ rules? But that's an entirely separate question from whether agencies must follow the CEQ regulations as a matter of what the executive branch says they have to do. So when the president gives you an order, you have to follow that order. And that's true whether or not the courts are going to enforce it. So you want to keep distinct those two things. One, a set of CEQ regulations that no matter what, are going to bind the agencies as a matter of internal executive branch governance and CEQ regulations that would be enforceable by the courts if agencies fail to live up to them.
- [19:26]
Santi Ruiz
Fantastic context. Let's go back to the Marin Audubon Society case. What happened here?
- [19:32]
Nicholas Bagley
Yeah, so the case involves what we call air tour management plans. So basically, if you have like a national park, for example, you want to make sure that you're setting the appropriate rules for flights that go over the park, whether that's tours to kind of see parts of the park you otherwise couldn't see, whether it's by airplane or by helicopter. And obviously those sorts of tours have a lot of noise implications and they have pollution implications. And so, yeah, you don't want too many of them. And you want to make sure that whenever they're going over the park, they're abiding by certain rules to protect sensitive wildlife, sensitive environmental areas. So the particular air tour management plan in question here involves four national park areas out in the west coast in kind of San Francisco area. And this particular management plan authorized about 2,500 commercial airline and helicopter flights to pass over four national park areas. And when the agency, the Federal Aviation Administration, developed the air tour management plan, it said, you know, we understand that NEPA is on the books, but we actually don't need to do an environmental impact statement to consider the effects of these flights. Why? Well, because there's a CEQ regulation that says that any changes or amendments to an existing sort of state of affairs doesn't need to go through NEPA if it only has minimal environmental impact. So anything that has no or minimal environmental impacts, CEQ regulations say agencies don't need to consider that through the whole NEPA process. So a bunch of environmentalists out west sued the FAA and said, Listen, you can't just ignore your NEPA obligations by saying, well, currently you've got 2,500 flights going through those areas. We're not making any changes. Therefore, we don't need to do an environmental impact statement. They said the right baseline is sort of thinking about the question from scratch, like what's the consequence of allowing any flights to go through those areas and how do you think about that problem? And so they sued, saying, we don't think it was appropriate for you to use that categorical exemption to avoid your NEPA obligations here.
- [21:40]
Santi Ruiz
And the courts, rather than the D.C. circuit Court, rather than ruling on that kind of narrow question, James, they, as I understand it, they ended up saying something very different. They kind of dodged that small question and answered a much bigger question.
- [21:54]
James Coleman
That's right. And this is the question that I said has been implicit for almost 50 years, which is CEQ issued these regulations in 1978, and they have often been treated as binding regulations by the court. So if you go back and look at all those aggressive court decisions that said, now the agencies have to consider this factor, now they have to consider that factor. Now they have to consider this other factor. Often they cited CEQ regulations because, for example, some of the most prominent CEQ regulations say not only do you have to consider the impacts of this federally approved or funded project, but you also have to consider the indirect impacts and the cumulative impacts of that project. So typically, CEQ regulations and all the decisions that have been based on them often cite these three kind of impacts, direct impacts, which you might think about. You know, it's basically your bulldozing a neighborhood for highway project that's the very direct impact. And then you have those indirect impacts and cumulative impacts. Now those indirect impacts are less well defined. Presumably it means something beyond the actual project or the part that is approved. So maybe if you're just approving a power line to cross a specific stream, maybe the indirect impact is, you know, the rest of the power line that's going to be enabled by this project. Or it could extend to all the new wind turbines that are going to be, that are going to be built as a result of this project. Or it could extend to all of the industrial activity that's enabled by all the electricity produced by those wind per mine, but really could go to any kind of, any kind of extent. And then maybe this isn't the only power line that's being built. And maybe we don't have some big decision to approve all of those projects that we have an environmental impact statement for. So maybe in this one environmental impact statement for a single water crossing, we should consider all of the power lines that will ever be built over the next 10 years in the state. And all of the wind turbines that will enable over multiple states and all the power users that that will enable.
- [24:00]
Santi Ruiz
And that's why you have thousand page NEPA review documents.
- [24:03]
James Coleman
Exactly, exactly. Those decisions are all based on these terms that CEQ just came up with in 1978. Now, and it's interesting, often in the legal realm, we think about what impacts are caused by some other thing. And there's standards in tort law about proximate cause, et cetera, that if you took first year law school, you'd learn about. But CEQ just came up with an entirely separate series of sort of causal analysis. And there are decades of analysis of that. And what the court here said is, hold up. Why are we following the CEQ regulations as binding? Because CEQ was never given authority to issue binding regulations that would be binding in court. You know, to Nick's point, may well have the ability, and they did issue guidelines. And that's probably unproblematic to say, hey, agencies, this is how we want you to do things. Ultimately, the President doesn't like how agencies are doing their, you know, their verbal reviews. You can fire the head of the agency. But in terms of binding in court, the courts have been treating this as binding for almost 50 years. And the court here, this decision said, no, they're not binding. They never had the authority to issue those regulations. And since the time that those regulations were issued, the courts have become more clear about when agencies have the authority to issue regulations. Often it's got to be in the statute that created them. You know, I think over time people have realized, wait a second, it never was clear that CEQ had this authority. And so it's become more and more of an anomaly that we continued arguing about these regulations when it wasn't clear that CEQ had the authority. So, you know, perhaps it's interesting. I mean, basically I filed an amicus brief in the Supreme Court case that's going to be heard tomorrow that argues that the Supreme Court should recognize that CEQ never had the authority to issue these regulations. Now, that was was written and filed before this decision came out from the D.C. circuit. So we knew this issue was out there. Some of us were hoping the courts might address it. But the D.C. circuit, as a sort of bit of a surprise to all of us, kind of address it, because neither of the parties to the case asked it to address this issue. But the D.C. circuit just said, why are we continuing to apply these regulations if CEQ never had that authority?
- [26:25]
Santi Ruiz
So, James, this legal philosophical matter that CEQ didn't have the authority to issue binding regulation. You haven't filed an amicus brief. What was the context here?
- [26:36]
James Coleman
Yeah, no, I, I think a lot of people had thought about it and the, and the courts have said before, wait a second. Well, we'll just keep applying this because the parties say we should apply it. Now, one thing you, I mean, one thing you find if you spend a fair amount of time outside of D.C. and then in D.C. appellate practice, in D.C. appellate practice, it's surprising how often both sides will want to continue applying whatever rules have been applying for the last decades that they both know how to apply, that they are used to. They say, well, maybe you don't like these, but you know what, we can argue our case for this. And, and so, you know, often actually, as a litigant, it can be a little bit, could be a little bit hard to get your D.C. lawyer to say, wait a second, I don't think any of this is valid. And to note, note, in this case, they did. The litigants didn't ask for this anyway. But, so this doesn't get raised. The reason why this doesn't get raised by any party, I think has a little bit to do with, you know, D.C. sort of liking to continue following the regulations that D.C. does. And I apologize this, if it's a, if it, you know, if it's a tangent, if you've ever read Anna Karenina where Levin, you know, one of the main characters is trying to get the agricultural workers to try a different way of doing something because it's way more efficient and they won't. And the same thing is true with professors. If you try to get professors to teach a class the new way that they haven't taught for years, they will not do it. So, you know, there's a, you know, inherent human conservatism that says, you know what, we've been doing it this way for years. Let's not, let's not mess with it. And, you know, I think that's partially responsible for why the CEQ continues. Those CEQ regulations continue to be applied even after people started to recognize maybe they weren't valid.
- [28:17]
Santi Ruiz
Adam and Nick, you're both, you're both laughing along. I want to hear from both of you.
- [28:19]
Adam White
Well, I just, and this month, you might want to edit this part out in post production. This might get into too far into the trivia, but Judge Randolph, who wrote the D.C. circuit decision blowing this whole thing up, he has a very long memory. As the D.C. circuit case says, this all started with an Executive order from President Carter in 1977 after a Supreme Court case the year before, when the Justice Department basically told the Supreme Court, CEQ does not have. It only proposes guidance. It doesn't guidelines. It doesn't have rulemaking authority. Judge Randolph would remember that because he was in the Solicitor General's office when that case was argued. More specifically, Judge Randolph was the Deputy Solicitor General who argued that case and told the Supreme Court in 1976, no, we don't have. The CEQ does not. It only does guidelines. It doesn't do rules.
- [29:05]
Santi Ruiz
So far from being a, you know, like a, like a new point, this is a. This is an issue that was raised at the kind of the inception of ceq. And it's that Randolph has cared about.
- [29:14]
Nicholas Bagley
For a long time. He's cared about for 50 years. He's been trying to get this issue presented squarely. I mean, one of the things that's super anomalous about this Marin county case is how the judge reached out to decide this issue even though no party had presented it and even though it wasn't necessary to resolving the case. So, Santi, you said earlier that the. The court avoided the narrow question about the proper baseline against which to measure the environmental impact statement. It actually didn't avoid that issue. It went on to say, hey, faa, you picked the wrong baseline. You can't use the existing flights as your baseline and then decide there were no effects from a similar plan. You got to use a baseline of zero and sort of think from there. So they could have just decided the case on that basis. And instead, Judge Randolph, joined by Judge Henderson on this, reached out to decide this issue that has been irritating him for a very long time. What that has done is make create a vulnerability for the decision. So Chief Judge Srinivasan dissented on this point, said, look, no party has raised this. There's no particular reason for us to wait in here. It's total dicta, which means it's like legal talk for unnecessary to the outcome of the case. And now we've got two en banc petitions. And en banc petition is, is what happens when the parties are upset about a panel decision at a circuit court. The parties can go to that circuit court and say, hey, you know, the three judges who decided our case, we're out to lunch. We think if the whole court heard this case, you'd side with us. It's a really important issue. So please, whole court, all the members of the court rehear this case, and both the environmental petitioners and the FAA. Both have gone to the D.C. circuit and said, hey, you know that part of Judge Randolph's opinion where he was just talking about things that really bother him, where nobody raised the issue. Could you just eliminate that part of the decision? Because neither of us likes it very much. And I think the D.C. circuit's reasonably likely to take up that invitation given just how hard Judge Randolph had to work to get this issue into focus in this case.
- [31:08]
Adam White
Now, since I brought that up, let me say a word in defense of Judge Randolph now, because I, I actually don't see it quite as negatively as Nick does. I do agree neither party raised this issue, to say the least. As the D.C. circuit points out, neither party would want this issue raised. Neither the environmentalists nor the, nor the, nor the federal agency. But the courts are there to decide cases under law. And while, and I clerked on the D.C. circuit for another good judge there, they, they do have a long history of being very careful about sticking to the arguments raised by the parties. This really is a strange situation where the, it's not clear at all whether the agency or the parties have real law to apply here. That's if there is an actual law there. The court doesn't really have much to decide its case on. Now, it's further complicated by the fact that the Supreme Court over the years has said in passing, arguably indicta, that so not in a way non binding, but it's sort of said in passing that the CEQ does have binding rulemaking authority and normally the D.C. circuit considers itself bound even by the dicta of the Supreme Court. So this, this, this really is a mess. I don't think it's entirely a mess of Judge Randolph's own making. There's a lot, as we've said, there's a lot of history here where nobody really poked this particular regulatory bear. The other, the other part of this.
- [32:32]
Nicholas Bagley
Adam, let me interrupt you and just say I think all three of us on this call, and you can correct me if I'm wrong about this on the merits. I think Judge Randolph is right. I don't think CEQ has rulemaking authority, and I think the courts have erred in applying CEQ rules in the past. I don't even think the question's that close. I know that that's a controversial opinion amongst environmental lawyers and the like, but, but I think James's amicus brief is just correct.
- [32:56]
James Coleman
Yeah. And the dissent doesn't even disagree. Right. It just, it just says, well, this issue wasn't raised. And so, and I do Think, I mean, you can understand, you could definitely understand why judges potentially don't like the idea that they continue to imply they, you know, just, oh, keep applying this invalid law because we both asked for it, but that it's a very, it's a very unsatisfying sort of argument.
- [33:16]
Santi Ruiz
Okay, so that's this Marin Audubon Society case we're recording on Monday, December 9th. On Tuesday the 10th, tomorrow morning, the Supreme Court is taking up oral arguments for a case that has similar NEPA ramifications. What's the relationship between that case and this case?
- [33:35]
James Coleman
So there's an issue in both the Marin Audubon Society case at the D.C. circuit and the seven county infrastructure case at the Supreme Court, which is, are these regulations valid? And Nick, I believe, has expressed the concern that we should want to keep these regulations, even if they may be invalid, because they help order the environmental review process as lengthy as it is. I've argued in this Supreme Court brief that instead these regulations are invalid and that will help speed up the environmental review process. I think it might be worth getting a little bit of back and forth on that issue.
- [34:13]
Nicholas Bagley
Yeah. So, James, I think my, my position is a little bit different than that, which is even if you agree with Judge Randolph here and say the CEQ regulations are non binding in court, they're still going to be binding on the agencies. And whether that's good or bad, it just has nothing to do with this case. You know, the only question at issue in this case is whether the CEQ regulations ought to be enforced in court. On that, I think the answer is no. But I do think that is not obviously a benefit for streamlining CEQ NEPO review. It may be, it may not be. And the reason I say that is because first, agencies are already going to have to abide by the CEQ regulations, so they're going to have to walk through that lengthy process regardless of whether it's judicially enforceable or not. Second, the CEQ process, as you say, does help structure how agencies move through that NEPA process. And a lot of the NEPA specific rules that are on the books explicitly say things like, hey, we're building off of CEQ regulations. If you look at the Army Corps NEPA regulations, for example, they say, hey, this is all just sort of a riff on what CEQ has already said.
- [35:21]
James Coleman
So.
- [35:22]
Nicholas Bagley
So the question is only about judicial enforceability on that front. You know, whether or not we apply the CEQ regulations. I'm just not sure it's going to have that big of an effect on agency practice. So agencies already are worried about the possibility of getting held up in court because they failed to consider a particular part of the problem. And you can recast all of those arguments either in terms of you failed to abide by CEQ regulations or just in terms of you failed to consider an important aspect of the problem under nepa. And either way, courts have proved receptive in the past to those arguments. So if you're a risk averse agency, you're still going to spend a lot of time chasing down every alternative because you're not sure what some random judge is going to decide was an issue that you needed to have considered, that you failed to consider. I'm not sure it changes the incentives for agencies on the ground.
- [36:12]
Adam White
Well, wait a second, Nick. Are you talking about just cases where an agency is facing a litigation risk from environmentalists or property owners who are wary of a project? Or are you also talking about cases where the project proponent itself might be looking to sue, say the highway or a power line or a pipeline doesn't get built, the project itself sues, saying no, you went beyond what you were allowed to do under nepa? I don't know. I'm just, I think so far we're really been thinking in terms of third parties challenging projects. But are you saying the same basic agency calculus would hold just in the relationship between the agency and the project proponent?
- [36:53]
Nicholas Bagley
Yeah, I mean, most of these cases aren't brought by the project proponents, they're brought by opponents. So I'm not sure how I'd think through the proponent question. But I think when you're, when you're considering the incentives of an agency, when it's thinking about a project, what it's trying to do is make sure it doesn't get held up in court. One of the ways you can try to avoid that is by abiding strictly to CEQ regulations. Another is by making sure to address every concern that the parties present to you. So let's say you have an environmental petitioner who during your environmental impact statement process raises a possible alternative that you should consider. That's a comment much like parties comment on agency rules all the time. And if the agency fails to respond thoughtfully to that comment, that could create a vulnerability for the project, much in the same way that failing to respond to a comment in a rulemaking can create a vulnerability for a rule. And so saying that CEQ regulations are no longer enforceable in court, I'm not sure that really changes your risk averse analysis. If you're an agency who's thinking through how to respond to, you know, input that it gets from environmental groups about what it ought to consider.
- [38:02]
James Coleman
Okay, so I think this is exactly where maybe there's a. There is some disagreement. I, I agree with Nick that it's possible that striking down these CEQ regulations, at least for purposes of court, might not do very much. And it might not do very much for a couple of reasons. One is if the President continues to insist that the agencies follow those regulations, then ultimately the reviews are going to be very similar. Also, if the courts continue to follow all the same decisions requiring more and more environmental review, and they just say, although we said that we were doing that under these CEQ regulations, which are no longer valid, we were actually applying the statute, which of course continues to apply. And so therefore we're going to require all the same you to jump through all the same boops to approve a project. If those two things happen, then striking down the CEQ regulations doesn't do much except for maybe make it a little bit more difficult to figure out how to argue in court. Right. With that said, I do think it sort of presents that opportunity that, you know, that Etch A Sketch opportunity to potentially change things. And in fact, our environmental reviews have gotten so long, and there's increasing bipartisan recognition that they have gotten too long, then I think there might be some momentum to use this opportunity to speed up the environmental reviews. And that could take two forms. One is the president could not require so much of the edc. And we've had a lot of back and forth about what things should be required under the CEQ regulations, going back and forth between the Trump administration and the Biden administration, with the Trump administration requiring lot, Biden administration requiring more, and then the Congress asking for some changes to the CEQ regulations. And so we might see, so we might, you know, I think we'll continue to see that in my. I anticipate that the new administration, with its focus on building new infrastructure in the US will likely not impose similar requirements that would have been required under the CEQ regulations, which have, you know, at least currently are struck down, might in theory be addressed by the Supreme Court. Who knows what's going to happen with en banc petition. So there's a lot of uncertainty for what kind of COQ regulations we're going to have going forward. Secondly, I think, you know, the reality is over time, we're getting new judges on the courts. And even if the judges from 10 years ago might still want to apply the same cases that they've been applying for decades and say, well, although the CEQ regulations are struck down, we're going to continue to apply that as a matter of the statute of the National Environmental Policy Act. It gives judges an opportunity to say, wait a second. This old. This old case was based on CEQ regulations that were no longer supposed to apply. I'm going to address this as a matter of first impression. And so basically, it gives circuit courts, like the D.C. circuit, the opportunity to basically make their jurisprudence on the National Environmental Policy act more aligned with the Supreme Court jurisprudence, which has been much more forgiving of, you know, basically shorter, less and less formal reviews than we've seen from the Circuit Court. So that's the reason that I'm optimistic that it creates an opportunity for change. But I do agree with Nick that it doesn't necessarily mean that we will see pastor reviews.
- [41:30]
Nicholas Bagley
James, you and I are on pretty much the same page. I'm a little more skeptical. I think that the effects of the decision by itself will prompt enough reconsideration in the courts or enough uniform reconsideration in the courts so as to adjust agency incentives. Right. Agencies are still going to be afraid that maybe those judges that you talk about, who newer, who might be less inclined to apply NEPA to the hilt, you know, would be receptive to a thinner eis. They're just not going to know the broader point, that this decision provides an Etch A Sketch moment, a chance for everybody to take a deep breath, look at what we've been doing, and maybe take a different path. I think that's exactly right. And I think the Trump administration has an opportunity here, potentially working with Congress, to really adjust meaningfully how NEPA is practiced in the. In the agencies and how the courts go about reviewing NEPA compliance.
- [42:19]
Adam White
Yeah, I think that's crucial in terms of Congress, There either has to be a conversation about NEPA itself and whether it's time to modernize terms and clarify terms like reasonable foreseeable environmental impacts, reasonable alternatives, or maybe both. Or we will have to consider project specific statutes or issue specific statutes. And sometimes this is a benefit. It's easier to sort of say to agencies, yeah, we're going to reduce the regulatory load for this one particular project because we think it's particularly important. But the more projects you see like that, they get a fast pass through the NEPA regulatory process. I think the more questions it raises about the quality and the burdens of the NEPA process for all the other projects. But I completely agree this is going to have this new decision in the D.C. circuit and whatever we see out of the Supreme Court in the next case, the Utah case, it's going to be an Etch A Sketch moment in all three branches, in the executive branch, in the courts and in Congress.
- [43:18]
Santi Ruiz
What are the possible verdicts the Supreme Court could provide on this question? As I understand it, they give the decision next summer.
- [43:25]
Adam White
Right.
- [43:25]
Santi Ruiz
They hear oral arguments now and we don't hear for a while. What, what, what's kind of the range of possibility here?
- [43:31]
Adam White
Well, I'll jump in one possibility and going back to James's taxonomy, the taxonomy that James noted of direct environmental impacts, indirect environmental impacts and cumulative impacts, you could see, I think the Supreme Court drawing a harder line between say direct impacts and indirect impacts. This would, this would be a significant decision. I don't know the Supreme Court would go all the way. But you could, you could in theory see the Supreme Court say NEPA was only created to deal with the direct impacts, the second and third order effects of, of, of a project that would have enormous effects itself on how agencies think about climate impacts and so on. But it would be of a piece with the Supreme Court's recent decisions under, I hate to throw more jargon out, but under headings such as the major questions doctrine and other areas where the Supreme Court has basically said to agencies, agency, you're in charge of a discrete limited issue. You are not sort of the free floating macro policy maker for the economy or our politics at large. An interpretation of NEPA that really limits the agency's purview to what's happening on the ground and in the air in the specific vicinity of a given project would be one way to significantly limit the regulatory burdens of nepa. But it would be, that would be an extremely consequential decision.
- [44:57]
Nicholas Bagley
I think the likeliest outcome is that the D.C. circuit will strip the portion of Judge Randolph's opinion saying that CEQ regulations are non binding and that the Supreme Court won't weigh in on the question. And we're going to kind of proceed with some judicial uncertainty on that, on that precise issue. All that said, I think James's point about the Etch A Sketch moment, all of that still applies even if the decision is overturned. I think that's why it's such an interesting moment, is that you can you kind of put Judge Randolph put this argument on, on the radar screen of people who are thinking about NEPA going forward. And it's kind of a moment where NEPA compliance is, is kind of a contested and up in the air sort of question where there is bipartisan interest in trying to reduce the burdens on agencies of environmental compliance review. And if that's the case, then I almost don't think it matters all that much what the courts decide in the near term about the binding status of CEQ regulations. It's just an opportunity to revisit a set of conventions that have hardened over time, and that that really ought to be reconsidered.
- [46:01]
Santi Ruiz
Can I add, how can something like this be practiced by the courts for 50 years? Everyone kind of understands that the CEQ doesn't necessarily have statutory authority, but it takes 50 years for someone like Judge Randolph to say, wait a minute, as a matter of kind of legal culture.
- [46:18]
Nicholas Bagley
So some of it has to do with the way that these cases normally get presented. So usually you've got an outside challenger who says, the agency did not do enough. And then the agency defends by saying, we did do enough. Sometimes the challengers say, you didn't do enough because you failed to abide by CEQ regulations. Well, the agency can't come back and say, those regulations don't bind us. Those regulations are irrelevant, those regulations. And so they tend not to make that argument. And because the argument is never squarely presented, the courts generally don't have an opportunity to address it. When NEPA was adopted, it was kind of before the Chevron era of strong Chevron deference. It was a kind of looser, gooseier time of administrative law, where the question about whether CEQ got some measure of deference on its regulations. Yeah, the court said, yeah, sure, you know, CEQ thinks about these questions. We'll listen to what it has to say. And it didn't harden into the rule that what CEQ says is the law until the Chevron revolution really took hold, and agencies with responsibility over statutes were given a great deal more deference than they had before, kind of strict, binding deference. So there's been sort of an underlying shift in the way we think about deference that I think, and a sort of lack of incentives to raise the question just the right way that I think has contributed to this sort of weird, lurking issue. That's my best guess, at least.
- [47:42]
Adam White
And I would add to that just again, from the private sector side of this. When a big project is getting built up, an infrastructure project, you have the agency in a conversation first and foremost with the project proponent. So when I was an energy infrastructure lawyer a long time ago, my office was basically a library of environmental impact statements from old projects. And for each new Project, I'd create a binder back in the days when you had binders with, with all of the rules, the, the CEQ rules, fercs, NEPA rules, FERCS rules under all the other statutes that would apply, the EPA and Army Corps of Engineers rules, the Department of Commerce's rules for the Coastal Zone Management act, and on and on and on, and all the state regulations. And this, as with any big project, it becomes a project of checklists and, and sort of structuring a procedure to just go through and cover everything. And not, not even just like in a cynical way of, oh, we need to paper up this project, you know, and in a good faith way of what's the way these projects are done and reviewed, how do we make sure the project succeeds and is also, you know, safe. And of course, when push comes to shove, there's a lot of negotiation around where to draw lines. But over and over again, the projects in each of these things starts by just taking for granted the entire body of rules and so on and just trying to get the project done under those rules. Maybe at some point you might start pushing back against a specific rule or interpretation, but for the most part, you've got the agency and the environmental groups and even the private sector taking for granted that the legal infrastructure around all of this is sound and taken for granted. We're in a different era now. In other areas of law, you see things like the financial industry pushing back against their regulators in a way that they never did before. Maybe you'll see a similar dynamic in the energy industry, I don't know. But for the most part, the private sector would take these things for granted as well and just try to get the project done under existing rules.
- [49:44]
James Coleman
Yeah. And you know, I could say that if you have a client that says, okay, I want to build this power line, how do I get my federal approvals for the water crossing? If you say, well, here's the whole CEQ process, but I've got this great legal theory that's been mentioned in a lot of concurrences about why we actually could completely rip up this process and start fresh. Most clients are, let's just stick to that, stick to the checklist. And ultimately, as lawyers, you know, as law professors, we know that law students, they want to hear what's the rules. They want to hear what are the rules. And if you start giving them, well, here's the theoretical reasons why maybe the rules are invalid. They get very frustrated. So, yeah, I think, you know, clients like law students, everybody Just wants to know what the process is and follow it. And so, you know, I do think there's a, you know, if there's going to be a reform, if there's going to be a reform moment, you know, we're going to want to pretty quickly get to, through to that new process because there's only a limited amount of tolerance for having, having the rules in flux. I did want to just say two things I think haven't been said so far. So one is this seven county infrastructure case. It's important to understand the context of it. So this is why we keep talking about. Adam's quite right, upstream and downstream impacts. This is a case about a piece of railroad in Utah that the courts have required that when the federal government approved this little railroad in Utah, it also analyze all the oil production that might happen across Utah. It's not a lot of oil production in Utah, but they said, well, you know, in theory this railroad would enable it. You should consider all of that. And then secondly, you should consider all of the impact of if there is a new oil that comes in this railroad, then maybe that would eventually reach the Gulf coast and go to refineries there and what would happen at the refineries there, etc. So it really is this sort of butterfly beats its wings idea that you should consider all those acts. And the court did say it was upstream and downstream or up rail and downrail impacts, although used all those terms, those projects. And so, you know, again, it really pursued all these ideas sort of out to the entities. That's. What's that issue there? And the final thing that we've been talking about that we probably should mention is an Etch A Sketch is a toy that you do a picture on and then you just shake it and the picture goes completely away. You can draw something different. So when we say Etch a Sketch moment, I know that that has entered the political lexicon through, you know, Governor, Senator Romney's campaign. But, you know, he's. He's got a little, you know, maybe there are folks who weren't around for that.
- [52:20]
Nicholas Bagley
James, are you calling us old? Yeah, I'm not sure everybody knows what.
- [52:22]
Adam White
I have to let.
- [52:23]
Santi Ruiz
Actually, I actually do remember that that was a part of my political awakening.
- [52:27]
James Coleman
Yeah, exactly. Exactly. So that's one of the interest sketches is basically an opportunity to sort of reconsider. To reconsider things that we're taking for granted for some period of time.
- [52:36]
Adam White
Sure. I think it's important to see this. It is just a result of 50 years of technological progress and scientific expertise. It was one thing to say in 1970, think about the environmental impacts of a project, right? You're building 88 miles of rail line in Utah. You would look around and say, like, what are we bulldozing here? What's the runoff? You know, even 50 years ago, you come up with theories about, oh, railroad might cause, you know, might throw some sparks that cause fires and so on, that kind of thing. That's still a pretty limited set of impacts. But now because of our scientific, our scientific expertise and our technology, we can in many ways project far into the future and at great distances. The, you know, the butterfly effects of these things. Butterfly flaps its wings and a storm bruise in, in, in, in the Gulf of Mexico or something. Also, over the last 50 years, we've become aware of the fact that sometimes you do have just low probability high impact effects due to complex energy infrastructure projects. I think when I think time and time again of the Gulf of Mexico well blowout, the Macondo well blowout, I think I was still an energy lawyer those days working on these issues. You get this deep water, Deepwater Horizon oil well blowout in the Gulf of Mexico, spilling oil everywhere. And an executive says, well, that was practically unthinkable. And when you go through, anytime you have a complex energy infrastructure project go bad, some, some very low probability thing that goes wrong, there's always going to be someone who says, well, no one could have seen that coming. Now we can actually project out a lot more of what could possibly go wrong in a very complex energy infrastructure project. The old book on the 80s about NEPA and by Serge Taylor was called Making Bureaucracies Think. And I've always kind of admired just that headline on a book. At the end of the day, you do need a process to help force decision makers, both in the private sector and in the public sector to think hard and think creatively about extremely hard to imagine consequences. And now we have technology that allows us to do more and more of that. The downside of that though, is that when it all gets bogged down into court and people are just sort of spitballing alternatives and possible effects, and there's no clear line between what's reasonable and unreasonable when you're sketching it out. We've seen over 50 years this become more and more complex. And in many ways the complexity is a good thing. It reflects our experience and our technology, but it does actually make this basic, simple statute from 1969 much, much harder to administer.
- [55:19]
Santi Ruiz
It's ironic that you talk about the role of NEPA in making agencies think about unintended consequences. Because one of the things through lines in this conversation seems to be that NEPA itself has all these unintended consequences and agencies, the original architects, did not foresee this, this outcome.
- [55:37]
Adam White
Oh, I have a story about that. I promise I'll be quick. Years ago, when I was still a lawyer, I was meeting with a favorite law professor of mine and he was asking what I was doing and I described NEPA stuff and he says, oh, when I was a clerk on the D.C. circuit, I had, I worked on a NEPA case. It was kind of interesting. And I thought to myself, I said, Richard, you clerked for Judge Skelly wright in like 1970. So you were the clerk on this case that's famous among the lawyers called Calvert Clips. That's the case that really made NEPA a big judicially enforceable thing. I said, did you work on the Calvert Cliffs case? And he goes, yeah, that was it, the nuclear regulatory case. He said, it seemed like a pretty straightforward case to me. How did it work out? And I open up again. These are the olden days. I open up my briefcase and I pull out four volumes of eis, of environmental impact statements that I was traveling with for work. And I dump it on the table, the table shakes. And I said, well Richard, it's no way to run a country, but it's the Adam White full employment plan. I mean the judges, 1970, well intentioned judges who are looking at a specific thing, a nuclear, a nuclear reactor in what was it, Maryland or something. Of course you want to bend over backwards and, and think as creatively as possible and force the government to think creatively about this. But it's no way to run a country when you can't build anything anymore. Such to the point that it's so hard to build power lines that we might recommission the Three Mile island reactor to fund or to power these data centers. We're going to see so many fights now in the next. Well, this presidential administration, regardless of whether Trump or Harris, would have won, especially under Trump and for years to follow. So much need for power in the mid Atlantic, so many hard questions about environmental impacts and property rights for these power lines. The kind of thing that Judges in the 1970s, let alone even Senator Scoop Jackson in 1969, could never have foreseen. All of it because of our great vast technological progress that makes both these projects more complex and the regulatory process more complex.
- [57:37]
Santi Ruiz
That's a great place to wrap up. Thank you all three for joining.
- [57:40]
James Coleman
Thank you so much.
- [57:42]
Santi Ruiz
It's great to be here.
- [57:43]
Adam White
Thanks. Santi.
- [57:44]
Nicholas Bagley
Santi, that I wanted you to tell that story on the podcast, Adam, so I'm glad you got to it.
- [57:49]
Adam White
Yeah. I can't mix again with the roadshow. He has to hear this story over and over again. I love this. I'll hear it.
- [57:53]
Nicholas Bagley
I'll hear it every day. So Richard Lizer says one of the ironies of NEPA is that it doesn't even mention judicial review. And it was meant originally as an internal executive branch management tool. It was adopted kind of the late 1960s, before the courts took a really hard look at what agencies did. And so when Congress adopted it, there was no expectation that the courts would change their practice. But it was adopted right as the D.C. circuit was intensifying the level of judicial scrutiny way past what it had been before. And so the D.C. circuit takes this law that was really meant just about internal executive branch management and retrofits it to suit the felt needs of the time. But it was. It was really not the original understanding of what NEPA was all about.
- [58:36]
James Coleman
When you look at some of the proposals for reform that Nick mentioned, you know, the president working with Congress may be looking to make some changes so that NEPA doesn't hold up infrastructure projects so much. A lot of the most important proposals will focus specifically on judicial review. And we've seen a number of them where they've said, hey, maybe we will get rid of the use of injunctions for judicial review. So that even if there's a dispute between the opponents of the project and the government about how much review has been done, the government can go do its review, but in the meantime, the project will be allowed to go ahead. And, you know, b, maybe there needs to be some kind of stronger time limits for when you can judicially challenge a project. So if you look at some of the previous reforms that have been used, a lot of times projects that Congress really has wanted to be built have been exempted from judicial review. So you can think about the Trades Alaska pipeline or the Mountain Valley Pipeline. And I think to the extent that Congress is really serious about addressing this challenge of National Environmental Policy act holding up needed infrastructure, you'll see them focus on limiting judicial review. And as Nick said, maybe that goes back more to the original meaning of the National Environmental Policy Act.