SCOTUS Limits Judicial Review of Agency NEPA Analyses

In Seven County Infrastructure Coalition v. Eagle County, the Supreme Court announced what it described as a “course correction” in judicial oversight of environmental reviews under the National Environmental Policy Act (NEPA), holding that the scope of NEPA reviews may be limited to the specific “proposed action” at issue and only those impacts within the regulatory authority of the agency.  

The Court made clear that agency deference remains available in judicial review of discretion-laden, fact-infused issues like how to define the proposed action for any given NEPA analysis.  At the same time, the Court stated that it is the role of the judiciary, not agencies, “to say what the law is” in interpreting NEPA’s statutory language.[i]

Although differing about the rationale, a unanimous court reversed the D.C. Circuit, which had ruled that the Surface Transportation Board (STB) violated NEPA by failing to adequately evaluate both “upstream” and “downstream” effects from subsequent actions projected to follow from the decision to approve a rail line. But the decision will strongly influence future NEPA decisions in all courts, with the Court providing a major boost to efforts to limit required environmental reviews—and accelerate the timeline for federal action on a wide range of infrastructure projects. 

Agency Action at Issue and Decision Below

In Seven County, the Seven County Infrastructure Coalition (Coalition) and Uinta Basin Railway (Railway) sought approval from STB to build an 88-mile railroad line to transport “waxy crude” oil deposits in the remote Uinta Basin (Basin) to the national rail network.  From there, the crude can be transported to refineries on the Gulf Coast for conversion into various petroleum products and eventual entry into the stream of commerce.  The relatively short rail link is critical to expanding development of Uinta Basin crude, because the only way producers can access the national rail network today is via truck hauling on narrow mountainous roads.

The STB has authority to regulate construction and operation of the nation’s railroad lines.  Central to its consideration of Petitioners’ request was the “common carrier” obligation that requires U.S. railroads to accept all commodities for transport upon reasonable request and without discrimination.  In response to the request, STB prepared an Environmental Impact Statement (EIS) spanning some 3,600 pages to analyze the proposed action’s reasonably foreseeable environmental effects.

The EIS defined both the scope of STB’s authority in considering the proposed rail line and the proposed action’s reasonably foreseeable environmental effects.  Given the common carrier mandate, STB determined that it lacked any authority to consider or regulate what it acknowledged were the “upstream effects” of substantially increased oil development in the Basin likely to result from the new rail link, or the likely “downstream effects” arising from the refining of such oil or eventual utilization of those refined products.  The Board declined to engage in a detailed analysis of either those potential upstream or downstream effects, opting instead to focus its EIS on effects of the proposed 88-mile rail line itself.

On a petition for review of STB’s approval, the D.C. Circuit held that STB’s EIS violated NEPA by failing to adequately assess both what it found were reasonably foreseeable upstream effects of the proposed rail line arising from the expected increase in oil drilling in the Basin and oil-train rail traffic, as well as reasonably foreseeable downstream effects of increased oil refining on environmental justice communities on the Gulf Coast.

The Coalition petitioned for certiorari on the question of whether NEPA “requires an agency to study environmental impacts beyond the proximate effects of the action over which the agency has regulatory authority.”[ii]

Supreme Court’s Opinion on the Merits

The Supreme Court unanimously reversed the D.C. Circuit’s judgment across a majority and concurring opinion.  The Court’s majority opinion determined that a major “course correction” was due and held that reversal was warranted on two independent grounds: (1) the D.C. Circuit’s failure to afford STB the substantial judicial deference the Supreme Court has long held is required in NEPA cases; and (2) the D.C. Circuit’s erroneous statutory interpretation in ruling that STB had a duty under NEPA to consider the effects of upstream and downstream projects separate in time and place from the rail line and outside STB’s statutory authority.

In explaining its first ground for reversal, the Court offered a broadly framed reproof of much NEPA jurisprudence since its last NEPA decision 11 years ago.[iii]  The Court engaged in a lengthy review of the major principles governing judicial review in NEPA cases challenging the adequacy of environmental reviews, which the Court summed up in one word: deference.  Finding an overly aggressive judicial review of NEPA analyses, the Court explained that a course correction is necessary “to bring judicial review under NEPA back in line with the statutory text and common sense.”[iv]

On the second ground for reversal, the Court held that the required scope of analysis under NEPA extends only to effects of the “proposed action” itself and not to those of any “separate projects.”[v]  The Court relied on the statutory text in NEPA that directs agencies, in analyzing proposed major Federal actions with significant environmental effects, to address the “reasonably foreseeable environmental effects of the proposed agency action.”[vi]  The Court emphasized that anything that depends upon some further act of human agency qualifies as a separate project, even if it is a foreseeable outgrowth of the proposed action under consideration and would not occur “but for” the proposed action, explaining that the need for some independent human action serves to break the chain of “proximate causation” in the context of defining reasonably foreseeable effects.[vii]

The Court distinguished between “indirect effects” of the proposed action that materialize outside its immediate geographic or temporal bounds, which may need to be included in a NEPA analysis, and the effects of a “separate project,” which do not.[viii]  The import of the Court’s legal standard is pronounced given two additional elements of its opinion:  (1) its indication that even interrelated projects close in time and space to the proposed action generally do not count as effects of the proposed action unless interrelated projects fall “within the authority of the agency in question”; and (2) its emphasis that courts also need to extend significant deference to agencies in defining the “proposed action” subject to NEPA review.[ix]

Future of Deference to Agencies on Judicial Review in Light of Seven County and Loper Bright

On the surface, the Court’s opinions in Seven County and Loper Bright[x] may appear to be in tension regarding agency deference.  The opinions can be read in concert, however, by distinguishing between the core issues at the heart of each case.  In Loper Bright, the primary issue was one of statutory interpretation, a question of law, which the Court reaffirmed lies firmly in the judiciary’s expertise, both under judicial review delineated in the Administrative Procedure Act (APA),[xi] and as a matter of constitutional law hearkening back to Marbury v. Madison.  The portion of its Seven County decision admonishing courts to extend deference to agency decisions, on the other hand, turns on technical expertise and a series of fine-grained, fact-dependent, and policy-laden judgments that NEPA effectively affords agencies broad discretion to make.[xii]

For pure questions of law such as statutory interpretation, a court owes no deference to an agency’s position beyond whatever persuasive authority the court may conclude it carries, as the Supreme Court ruled in Loper Bright.  But for issues suffused with factual findings or drawing on agency expertise, such as where to draw the innumerable lines agencies are called upon to demarcate in NEPA analyses, federal judges are to defer to agency decision-making.  Seven County and Loper Bright therefore collectively can be seen as reaffirming the historic respective “lanes” the Executive and Judicial Branches have occupied, within which each deserves primacy.[xiii]

Potentially Significant Implications of Seven County for NEPA Practice and Litigation

It is worth noting a few potentially significant implications of the paring back of judicial review of NEPA effects analysis that the Court prescribed in Seven County.

First, pursuant to Executive Order (E.O.) 14154, Unleashing American Energy,[xiv] the Council on Environmental Quality (CEQ) rescinded its NEPA implementing regulations effective as of April 11, 2025,[xv] and issued guidance for agencies to revise their agency-specific NEPA regulations within 12 months.[xvi]  In crafting these regulations, agencies will need to account for the new thrust governing the scope of NEPA effects the Court espoused in Seven County.

Second, the duty for agencies to consider cumulative effects in future NEPA analyses may have been significantly changed. This stems from the Court’s declaration that “reasonably foreseeable effects of a proposed agency action” do not include the effects of separate projects, which often have been the primary grist for agencies’ cumulative impacts analyses.

Third, the Court went out of its way to emphasize that even if a NEPA analysis is determined to be deficient in some way, that determination does not compel the reviewing court to vacate the underlying agency action, “at least absent reason to believe that the agency might disapprove the project if it added more to the EIS.”[xvii]

Conclusion

For more information on the impacts of Seven County, or to discuss a NEPA analysis for your federal project, please contact the author, Steve Odell. 

[i]   S. Ct. no. 23-945, 2025 WL 1520964 (May 29, 2025).

[ii]  Petition for A Writ of Certiorari at i, Seven County Infrastructure Coal. v. Eagle Cnty., 2025 WL 1520964, S. Ct. no. 23-975.

[iii]  Id. at **6-9.  Before Seven County, the Court’s last NEPA decision was Monsanto Co. v. Geertson Seed Farms, 561 U.S. 139 (2010).

[iv] Id. at *9.

[v] Id.

[vi]  Id. at *10 (citing 42 U.S.C. § 4332(2)(C)) (emphasis supplied).

[vii]  Id. at **10-11.

[viii] Id. at *7, 9.

[ix]   Id. at *12.

[x]  Loper Bright Enterprises v. Raimondo, 144 S. Ct. 2244 (2024).

[xi]  5 U.S.C. § 706(2)(A)-(F).

[xii]  Indeed, the statutory basis for EISes is extremely broadly framed and comprises a single subparagraph in NEPA.  42 U.S.C. § 4332(2)(C).

[xiii]  An example from Seven County itself demonstrates that this distinction may not be as neat or simple as it may first appear, however.  In broadly discussing the level of detail required in NEPA analysis, the Court begins by noting that the meaning of “detailed” in NEPA in the context of its requirement for agencies to produce a “detailed” EIS “is a question of law to be decided by a court.”  Id. at *12.  It goes on, however, to explain that, where the rubber meets the road—in defining what details actually need to be included in an EIS—considerable agency discretion is required and thus, such determinations “should not be excessively second-guessed by a court.”  Id.

[xiv]   E.O. 14154, Unleashing American Energy, 90 Fed. Reg. 8353 (Jan. 29, 2025).

[xv]   CEQ, Interim Final Rule, Removal of National Environmental Policy Act Implementing Regulations, 90 Fed. Reg. 10,610 (Feb. 25, 2025).

[xvi]  CEQ, Memorandum for Heads of Federal Depts. & Agencies re:  Implementation of NEPA (Feb. 19, 2025).

[xvii]Seven County, 2025 WL 1520964 at *9.