On February 3, 2025, a federal court in North Dakota delivered a significant blow to the Council on Environmental Quality (CEQ), ruling that the agency lacks the authority to issue regulations under the National Environmental Policy Act (NEPA). This decision, which follows a similar ruling by the D.C. Circuit Court of Appeals last November, has sent shockwaves through the environmental community and raised critical questions about the future of NEPA and its implementation.
The case, State of Iowa v. Council on Envt’l Quality, centered around the authority of CEQ to issue regulations. The plaintiffs, led by the state of Iowa, challenged a rule promulgated by CEQ in 2024, arguing that the agency did not have the legal standing to create such regulations. The court’s decision hinged on a careful examination of NEPA and the specific duties assigned to CEQ by the statute.
NEPA, enacted in 1970, is a cornerstone of U.S. environmental law. It mandates that federal agencies conduct environmental reviews before undertaking major actions, ensuring that the environmental impacts are thoroughly assessed. CEQ, established by NEPA, has traditionally played a pivotal role in guiding federal agencies through this process. However, the recent court rulings have called into question the extent of CEQ’s authority.
The 2024 Rule, which was the subject of the lawsuit, aimed to update and expand NEPA’s regulatory framework. It introduced changes such as codifying page and time limits for environmental assessments (EAs) and environmental impact statements (EISs), enhancing public engagement, and addressing climate change and environmental justice concerns. These updates were part of a broader effort by CEQ to modernize NEPA’s implementation, reflecting evolving environmental priorities and legal interpretations.
The court’s decision in State of Iowa v. Council on Envt’l Quality hinged on a key legal principle: whether NEPA grants CEQ the authority to issue regulations. The court referenced the Supreme Court’s recent decision in Loper Bright Enters. v. Raimondo, which emphasized that courts should independently interpret statutes to determine the boundaries of an agency’s authority. The court found that NEPA’s language does not explicitly grant CEQ the power to issue regulations. Instead, CEQ is tasked with making recommendations to the President and developing national environmental policies.
This ruling has significant implications for the future of NEPA and how federal agencies will interact with the statute. With CEQ’s regulatory authority now in question, there is uncertainty about who will guide federal agencies through the NEPA process. The absence of clear regulatory frameworks could lead to inconsistencies in how agencies conduct environmental reviews, potentially undermining the effectiveness of NEPA.
Moreover, the ruling raises broader questions about the role of executive agencies in implementing environmental laws. If CEQ cannot issue regulations, it may fall to other agencies or the President to provide guidance on NEPA compliance. This shift could alter the dynamics of environmental policy-making and enforcement, potentially leading to a more fragmented approach to environmental protection.
As the legal landscape continues to evolve, stakeholders will be closely watching how federal agencies respond to this ruling. The future of NEPA and the environmental review process hangs in the balance, with potential ramifications for how the U.S. addresses environmental challenges in the years to come.