Council on Environmental Quality Issues Long Awaited Guidance for Environmental Review Across Agencies

On September 29, 2025, the Council on Environmental Quality (CEQ) issued long-awaited guidance to formalize agencies’ individual efforts to implement the National Environmental Policy Act (NEPA).  After rescinding the CEQ regulations that shaped NEPA for 40+ years and bearing witness to various agencies’ independent efforts to issue their own NEPA rules, CEQ issued new guidance to more systematically guide the agencies’ efforts.  As CEQ notes, “NEPA implementation reform now has been called for, authorized, and directed by all three branches of government at the highest possible level: Congress, the President, and the Supreme Court.”  The guidance reflects direction from each.

Regulatory template.  Although CEQ leaves to each agency’s discretion whether to promulgate implementing procedures through rulemaking or guidance, CEQ’s guidance provides a regulatory “template.”  The template provides a uniform set of regulations with minimal need to add other detail, suggesting a desire by CEQ to maintain a consistent NEPA regulatory system across federal agencies despite CEQ’s rescission of its set of uniform regulations earlier this year.

Substantial flexibility.  Compared to CEQ’s rescinded regulations, both the guidance and template introduce significant flexibility for “agency discretion.”  CEQ directs agencies to implement NEPA in a manner consistent with recent judicial precedent, including the Supreme Court’s holding in Seven County, and suggests throughout that agencies should retain — and codify — its discretion to define whether NEPA applies (e.g., a “major Federal action”), the scope of an action’s “effects” that is subject to environmental review, and more.

Exemption for nondiscretionary acts.  Importantly, CEQ suggests that agencies codify a NEPA exemption for “nondiscretionary” acts, a major departure from the prior regulations’ silence on the topic.  Codifying that exemption could have major impacts in the future, as agencies seek to define “nondiscretionary” acts to which NEPA does not apply.  CEQ defines nondiscretionary acts in its template as “circumstances where Congress by statute has prescribed decisional criteria with sufficient completeness and precision such that [agency] retains no residual discretion to alter its action based on the consideration of environmental factors.”  The application of this new definition will likely open the door to litigation, particularly where agencies broadly define such “nondiscretionary” acts — a likely unintended consequence as the new term illustrates the current administration’s dual directives to limit both agency action and judicial review.

Project Sponsor Opt-In Fee.  Finally, CEQ urges agencies to account for and craft solutions implementing the One Big Beautiful Bill Act’s NEPA amendment adding a new Project Sponsor Opt-In Fee.  This provision allows project sponsors to pay an optional, upfront fee to federal agencies to expedite the NEPA environmental review process, resulting in shortened NEPA review deadlines that are ultimately coordinated through CEQ.

Overall, CEQ’s call for a streamlined, efficient, and predictable NEPA process across agencies should provide predictability across federal agencies regarding the level of analysis and time for environmental reviews.  We are likely to see growing pains and increased litigation, however, as the guidance is implemented to produce new regulations and those regulations are tested in federal courts.

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