JurisdictionUnited States
National Environmental Policy Act (Nov 2017)


James M. Auslander 1
Beveridge & Diamond, P.C.
Washington, DC

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JAMES M. AUSLANDER co-chairs Beveridge & Diamond's Energy practice team, and is based in Washington, D.C. Jamie focuses his practice on complex legal issues surrounding development of oil and gas, hardrock minerals, other natural resources, and renewable energy on public lands onshore and on the Outer Continental Shelf. He frequently works with the Bureau of Ocean Energy Management and prosecutes appeals before the Interior Board of Land Appeals regarding royalty, suspension, decommissioning, regulatory departures, and other issues. He also assists multinational corporations, domestic companies, and leading industry trade associations in protecting valuable lease rights and navigating the ever-changing environmental requirements to develop those leases.


The first task in any National Environmental Policy Act (NEPA)2 review is to define the scope of a project and the relevant environmental considerations. This step might sound both obvious and straightforward, but in practice it often is neither. Variables may include, but are not limited to, the geographic area at issue, the extent of the environmental effects discussed, and the specificity of the analysis. Energy and minerals projects are no exception to the challenge of determining the appropriate scope of environmental analysis under NEPA.

This article explores these NEPA scoping questions and illustrative case law, which continues to evolve. Three aspects warrant particular attention. First, "segmentation" concerns whether multiple federal actions should be analyzed collectively as a single action within a NEPA document. Second, the "small handles" issue involves to what extent a private project becomes "federalized" due to the need for discrete federal approvals. Finally, staged development and approvals, and the respective rights conferred, impact the scope and detail of the environmental effects that an agency must address at a given point in time.

In sum, it is critical to take the time to fully consider the scope of the project or proposal before embarking on the NEPA analysis. The criticality of this issue for defensible NEPA reviews cannot be overstated. Failure to properly characterize the agency action or shortchanging the universe of relevant impacts at the outset can prejudice the underlying project through adverse litigation outcomes and correspondingly extensive and expensive delays.

This article is not intended to be an exhaustive survey of all possible situations that might apply in any given case. It also does not duplicate discussions of important related topics expansively addressed in other papers for this Special Institute, including more detailed consideration of indirect and cumulative impacts and connected actions, defining the purpose and need and reasonable range of alternatives, and how to optimally build the administrative record. Affected parties should consult counsel to ensure compliance with NEPA, maximize efficiency, and protect their rights.

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Like any NEPA issue, scoping should be viewed through the lens of NEPA's core "twin purposes of ensuring that (1) agency decisions include informed and careful consideration of environmental impact, and (2) agencies inform the public of that impact and enable interested persons to participate in deciding what projects agencies should approve and under what terms." Dep't of Transp. v. Pub. Citizen, 541 U.S. 752, 768 (2004). The NEPA legal obligation belongs to one or more federal agencies - rather than a non-federal applicant - and is wholly procedural. Id. at 756-57. Agencies and project proponents should remember that "NEPA's purpose is not to generate paperwork--even excellent paperwork--but to foster excellent action" informed by an understanding of relevant environmental effects. 40 C.F.R. § 1500.1(c) (2003).

NEPA is triggered by "proposals for . . . major Federal actions significantly affecting the quality of the human environment."3 Under Council on Environmental Quality (CEQ) regulations applicable to all federal agencies, "proposal" means the agency has a goal and is "actively preparing" to implement that goal. 40 C.F.R. § 1508.23. In other words, there must be some real federal agency action contemplated. If NEPA review begins too early, insufficient information is available for a meaningful analysis. Conversely, commencing NEPA too late defeats the objective of having agencies "stop and think" before making a decision.

Electing to initiate NEPA review, however, is easier than identifying the proper scope of that review. For example, complex energy, minerals, and infrastructure projects frequently involve numerous activities and require multiple federal agency approvals under different laws and regulations. Should each permit or approval, or each individual agency's actions, be subject to its own NEPA analysis? Should each component or stage of the underlying project be analyzed separately or together? Are other projects close in timing or geographic proximity truly separate for NEPA purposes?

The CEQ regulations governing an Environmental Impact Statement (EIS) (which increasingly have been construed to also apply to a less detailed Environmental Assessment (EA)) specify that the "scope" of NEPA review should consider the following "range of actions, alternatives, and impacts":

(a) Actions (other than unconnected single actions) which may be:
(1) Connected actions, which means that they are closely related and therefore should be discussed in the same impact statement. Actions are connected if they:
(i) Automatically trigger other actions which may require environmental impact statements.
(ii) Cannot or will not proceed unless other actions are taken previously or simultaneously.

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(iii) Are interdependent parts of a larger action and depend on the larger action for their justification.
(2) Cumulative actions, which when viewed with other proposed actions have cumulatively significant impacts and should therefore be discussed in the same impact statement.
(3) Similar actions, which when viewed with other reasonably foreseeable or proposed agency actions, have similarities that provide a basis for evaluating their environmental consequences together, such as common timing or geography. An agency may wish to analyze these actions in the same impact statement. It should do so when the best way to assess adequately the combined impacts of similar actions or reasonable alternatives to such actions is to treat them in a single impact statement.
(b) Alternatives, which include:
(1) No action alternative.
(2) Other reasonable courses of actions.
(3) Mitigation measures (not in the proposed action).
(c) Impacts, which may be:
(1) Direct;
(2) indirect;
(3) cumulative.

40 C.F.R. § 1508.25.4 Yet in practice, there are no clear scoping rules applicable in every circumstance. The appropriate scope of NEPA review varies depending on the nature of the project, approval, and federal agency. Practical or strategic considerations may also come into play based on, e.g., particular project needs, availability of information, timing concerns, and the likelihood of subsequent similar actions. As the above CEQ regulation acknowledges, "the scope of an individual [NEPA document] may depend on its relationships to other [NEPA documents]."5

One key principle of scoping, however, is to protect against "segmentation" claims. "An agency improperly 'segments' NEPA review when it divides federal actions into separate projects and thereby fails to address the true scope and impact of the activities that should be

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under consideration."6 That is, a federal agency should not view the scope of its review so myopically as to exclude what may fairly be aggregated within the full scope of the underlying project. This concern is especially pronounced where an agency is employing a categorical exclusion or preparing an EA, and faces demands that it should instead prepare an EA or EIS to analyze purportedly cumulatively significant impacts. For example, in Delaware Riverkeeper, the D.C. Circuit held that the Federal Energy Regulatory Commission (FERC) erred by segregating its NEPA analysis of one natural gas pipeline upgrade project from other upgrades elsewhere on a longer pipeline encompassing that segment.7

That is not to say that every potentially similar or related project must be considered within a single NEPA document.8 Federal agencies retain considerable discretion to determine how to scope their NEPA documents and decide which actions should be analyzed together. Accordingly, court findings of segmentation are relatively uncommon, particularly where two or more actions are not physically connected. The key test is to demonstrate, in the administrative record, that the project subjected to NEPA review has "independent utility" such that it is viable and makes sense standing on its own.9 Moreover, federal agencies should not speculate as to other potential actions, or their possible impacts, that are not "reasonably foreseeable."10

The takeaway principle is that great care should be taken at the initial scoping stage to ensure the proposed action is not unduly narrow. The public scoping process that is standard for an EIS and encouraged for an EA can be extremely helpful in verifying that the scope of both the proposed action and the relevant environmental effects are appropriate.11 In some instances, e.g., a series of similar planned activities each triggering NEPA review, there even may be time and cost advantages to a greater upfront investment in programmatically considering multiple actions...

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