Fiscal Responsibility Act of 2023 (FRA)

What changes did the Fiscal Responsibility Act of 2023 (FRA) make to NEPA?

The FRA amendments to NEPA:

• Codify that environmental impact statements should include discussion of reasonably foreseeable effects of a proposed action, reasonably foreseeable effects that cannot be avoided, and a reasonable range of alternatives to the proposed action. (Sec. 102(2)(C); 42 U.S.C. § 4332(2)(C)).
• Clarify requirements for determining whether to prepare an environmental document and the appropriate level of NEPA review. (Sec. 106; 42 U.S.C. § 4336).
• Clarify the roles and responsibilities of lead agencies and cooperating agencies, including designation of such agencies. (Sec. 107(a); 42 U.S.C. § 4336a(a)).
• Promote development of a single environmental document. (Sec. 107(b); 42 U.S.C. § 4336a(b)).
• Set page limits and deadlines for environmental impact statements and environmental assessments. (Sec. 107(e) and (g); 42 U.S.C. § 4336a(e) and (g)).
• Direct agencies to develop procedures for how, under Federal agency supervision, project sponsors may prepare environmental assessments and environmental impact statements. (Sec. 107(f); 42 U.S.C. § 4336a(f)).
• Provide time lengths and circumstances for when agencies can rely on programmatic environmental documents without additional review. (Sec. 108; 42 U.S.C. § 4336b).
• Establish a process for Federal agencies to use another agency's categorical exclusions. (Sec. 109; 42 U.S.C. § 4336c).
• Require CEQ to conduct a study of online and digital technologies to help provide for efficient reviews and improve public accessibility and transparency. (Sec. 110; 42 U.S.C. § 4336d).
• Define terms used in NEPA, including cooperating agency, environmental document, lead agency, major Federal action, participating Federal agency, programmatic environmental document, and special expertise. (Sec. 111; 42 U.S.C. § 4336e).

What is the effective date of the 2023 amendments to NEPA?

The amendments to NEPA are effective June 3, 2023.

How do the amendments apply to ongoing NEPA reviews?

Federal agencies are responsible for determining how the amendments apply to their ongoing NEPA reviews and should consider congressional intent to facilitate more efficient NEPA analysis when making this determination. Many of the provisions of the FRA codify best practices an agency may already include in its NEPA reviews, or ones an agency may integrate into an ongoing review with little or no disruption. Where implementation of a provision could lead to inefficiency in an ongoing NEPA review, agencies should engage in a fact-specific evaluation to determine the appropriate approach that considers the statutory requirements; the level of NEPA review (i.e., environmental impact statement, environmental assessment, or categorical exclusion); the stage at which the environmental review was at the time of the amendment; the expectations of any project proponents; additional resources that would be required to implement the provision; the extent of any disruption it could cause; and other legal considerations.

When do CEQ’s revisions to the NEPA regulations take effect, and how do they affect ongoing reviews and existing agency NEPA procedures? Does the effective date for the NEPA regulations change the effective date for the 2023 NEPA amendments?

CEQ’s Bipartisan Permitting Reform Implementation (BPRI) rule—which implements the Fiscal Responsibility Act amendments to NEPA and makes other changes to modernize the environmental review process by amending the CEQ regulations, 40 C.F.R. Parts 1500 through 1508—is effective on July 1, 2024. See 40 C.F.R. § 1506.12. This does not impact the effective date of the 2023 NEPA amendments which were effective on June 3, 2023. Agencies must continue to comply with the 2023 NEPA amendments.

Agencies may apply the revised regulations to ongoing activities and environmental documents begun before July 1, 2024, but are not required to do so in order to avoid disruption to or delay for ongoing reviews. As has been true for CEQ’s other recent regulatory revisions, the final rule allows agencies to choose to apply the revised regulations to ongoing reviews if they determine, for example, that doing so will improve the efficiency of the review.

An agency’s existing NEPA procedures remain in effect until the agency revises its procedures consistent with 40 CFR § 1507.3; however, agencies should read their existing procedures in concert with the final rule to ensure they are meeting the requisite requirements of both wherever possible. To the extent that there is conflict between an agency’s NEPA procedures and the CEQ regulations, the CEQ regulations generally will apply. CEQ is available to assist in addressing any such conflicts.

How do the NEPA regulations implement the page limits for environmental assessments and environmental impact statements required by 2023 NEPA amendments?

The final rule fully implements the page limits included in the 2023 NEPA amendments. Under the rule, environmental impact statements must be 150 pages or less, or 300 pages or less for proposals of extraordinary complexity. 40 C.F.R. § 1502.7. Environmental assessments must be 75 pages or less. 40 C.F.R. § 1501.5(g). The final rule defines a “page” as containing 500 words and excludes citations, explanatory maps, diagrams, graphs, tables, and other means of graphically displaying quantitative or geospatial information. 40 C.F.R. § 1508.1(bb).

Implementation of page limits will lead to environmental documents that focus on important issues, avoid excessive technical information, and are understandable to the decision maker and the public.

CEQ’s regulations highlight some approaches that agencies can use to continue to perform appropriate environmental reviews while meeting the page limits. Additionally, CEQ guidance and agencies have identified other practices that achieve these objectives. For example, agencies can:

• Use the scoping process to help identify the important issues for analysis in the environmental impact statement or environmental assessment; and develop scoping reports—which the agency appends to an environmental impact statement or environmental assessment—to help focus the analysis on important issues and explain why the agency determined to focus on certain issues and not others. See 40 C.F.R. §§ 1500.4(f), 1501.9, 1502.4.
• Create annotated outlines and establish page “budgets” that allocate a set number of pages for each section of the NEPA document.
• Use programmatic reviews to develop environmental documents of broader scope that the agency can tier to and rely on in subsequent NEPA documents, eliminating repetitive discussions. See 40 C.F.R. §§ 1500.4(h), 1501.11, and 1502.4.
• Incorporate by reference into an environmental impact statement or environmental assessment prior analyses, studies, or other information, briefly summarizing them, and either linking to such publicly available information or including it in an appendix. See 40 C.F.R. §§ 1500.4(i) and 1501.12.
• Adopt previously completed environmental documents where another agency has conducted a NEPA review on the same or similar action. See 40 C.F.R. §§ 1500.4(m) and 1506.3.
• For contractor- or consultant-prepared documents, include contract terms or specifications requiring page limits and providing contract incentives for developing concise and effective NEPA documents.
• For environmental impact statements, combine the discussion of the affected environment and environmental consequences and limit duplicative discussion of alternatives in the discussion of environmental consequences. See 40 C.F.R. §§ 1502.14–1502.16.

Agencies also must write environmental documents in plain language and should use graphics, maps, tables, and other accessible means of presenting information so that decision makers and the public can readily understand the information and make informed decisions. For example, agencies can place technical analyses, data, and other supporting material in an appendix to an environmental impact statement or environmental assessment. See 40 C.F.R. §§ 1500.4(c), 1502.8, 1502.12, 1502.19; see also Federal Plain Language Guidelines (Mar. 2011).

CEQ’s guidance on Preparing Efficient and Timely Environmental Reviews under NEPA provides additional discussion on how to develop effective and readable environmental documents that meet the page limits.

How do the regulations implement the deadlines included in the 2023 NEPA amendments for agencies to complete environmental assessments and environmental impact statements and how are they calculated?

The final rule fully implements the Fiscal Responsibility Act’s deadline requirements and requires an agency to complete an environmental assessment within one year and an environmental impact statement in two years, unless the agency extends the deadline in writing after consulting with any applicant. Agencies can only extend deadlines by the amount of time necessary to complete the environmental assessment or environmental impact statement. See 40 C.F.R. §§ 1501.10(b)(l)–(2).

The final rule provides the start and end points for calculating the deadlines for environmental impact statements and environmental assessments. Specifically, the starting points are the earlier of when:

• The agency determines that NEPA requires an environmental impact statement or environmental assessment for the proposed action;
• The agency notifies an applicant that it has received a completed application; or
• The agency issues a notice of intent for the proposed action.

40 C.F.R. § 1501.10(b)(3).

The end points are:

• For environmental assessments, the date when the agency publishes an environmental assessment, issues a notice of intent to prepare an environmental impact statement, or, where applicable, makes an environmental assessment available pursuant to an agency’s pre-decisional environmental review process.
• For environmental impact statements, the date when the Environmental Protection Agency publishes a notice of availability of the final environmental impact statement or, where applicable, when the agency makes the final environmental impact statement available pursuant to an agency’s pre-decisional administrative review process.

40 C.F.R. § 1501.10(b)(4).

How does the final rule facilitate timely decision-making processes, helping agencies meet the deadlines?

The final rule contains several provisions to improve the efficiency of the environmental review process. For example, the rule:

• Includes processes for early planning, public and governmental engagement, and interagency collaboration to identify and resolve issues early in the process. See, e.g., 40 C.F.R. §§ 1501.7–1501.9, 1502.4.
• Requires agencies to develop schedules that include the milestones needed to complete the environmental review and issue any necessary Federal authorizations. Lead agencies develop schedules in collaboration and consultation with participating agencies and applicants, and seek concurrence from participating agencies. 40 C.F.R. §§ 1501.10(a), (c).
• Codifies the practice of using mitigated FONSIs, which expand the circumstances in which an agency may prepare an EA to reach a FONSI, rather than preparing an EIS. 40 C.F.R. § 1501.6(a)(2).
• Encourages agencies to incorporate information by reference where the agency provides a brief summary of the content and its relevance to the environmental document, and indicates where the information is readily available to the public by providing citations or hyperlinks. 40 C.F.R. §§ 1500.4(i), 1501.12.
• Includes new pathways for CE development through land use plans, programmatic documents, or other equivalent planning process and decision. 40 C.F.R. § 1501.4(c).
• Details a process for an agency to adopt and use another agency’s categorical exclusion. 40 C.F.R. § 1501.4(e).
• Allows agencies to apply categorical exclusions to proposed actions where extraordinary circumstances exist as long as the agency determines that the proposed action will not in fact result in significant effects notwithstanding the existence of the extraordinary circumstance, or the agency modifies the action to avoid the potential to result in significant effects. 40 C.F.R. § 1501.4(b)(1).
• Encourages agencies to prepare programmatic environmental documents to conduct a broad or holistic evaluation of effects or policy alternatives, evaluate widely applicable measures, or avoid duplicative analysis for individual actions by first considering relevant issues at a broad or programmatic level. Agencies may then tier to programmatic documents to eliminate repetitive discussions of the same issues, analyzing site-, phase-, or stage-specific conditions and reasonably foreseeable effects and excluding from consideration issues already analyzed or decided. 40 C.F.R. §§ 1500.4(h), 1501.11.

When must agencies submit a report to Congress on missed deadlines?

Section 109(h) of NEPA requires a lead agency to annually submit a report identifying any environmental assessments and environmental impact statements with a missed deadline and explaining why the deadline was missed. Consistent with the Memorandum for Heads of Departments and Agencies on Reports to Congress on Deadlines Under NEPA, issued by CEQ on May 31, 2024, the first report is due in June 2025 and should include missed deadlines for environmental assessments. The second report is due in June 2026 and should include missed deadlines for environmental impact statements and environmental assessments. Agencies do not have to submit a report if they do not have any missed deadlines.

Consistent with section 109(g)(2) of NEPA, agencies may extend a deadline, in writing, after consulting with any applicant so long as the extension is only the amount of time necessary to complete the environmental assessment or environmental impact statement. See 40 C.F.R. §§ 1501.10(b)(l)–(2). Agencies should extend deadlines where it is appropriate to do so.

How do deadlines and reporting apply to actions initiated before the 2023 Amendments to NEPA were effective?

For purposes of the annual report, agencies cannot be expected to have implemented the deadlines established by the statute and the mechanisms for extending such deadlines until enactment of the FRA, which was June 3, 2023. Therefore, for NEPA reviews that were ongoing when the FRA was enacted, agencies should consider the starting point for measuring deadlines for purposes of the annual reports to be June 3, 2023. If agencies have ongoing NEPA reviews that require more than one year for an environmental assessment or two years for an environmental impact statement measured from the enactment of the FRA, they should take steps to extend those deadlines, in consultation with any applicant, and establish a new deadline that provides only so much additional time as is necessary to complete the environmental review as directed by the statute.

How does the final rule incorporate the roles and responsibilities of lead, joint lead, cooperating, and participating agencies included in the 2023 NEPA amendments?

The 2023 NEPA amendments require designation of a lead agency, clarify the considerations for designating, when it is appropriate, cooperating agencies and joint lead agencies, and set forth roles and responsibilities for agencies participating in the NEPA process. CEQ’s revised regulations fully incorporate these amendments.

• The final rule directs participating Federal agencies to consider the following when determining which will serve as the lead agency: (1) the magnitude of an agency’s involvement, (2) the project approval or disapproval authority, (3) the expertise of an agency concerning the actions environmental effects, (4) the duration of an agency’s involvement, and (5) the sequence of an agency’s involvement. See 42 U.S.C. § 4336a(a)(1)(A); 40 C.F.R. § 1501.7(c).
• If the participating Federal agencies cannot agree on a lead agency, there is a process for them to request that CEQ designate a lead agency. See 42 U.S.C. § 4336a(a)(5); 40 C.F.R. § 1501.7(e).
• If a lead agency is not designated, there is process for any Federal, State, Tribal, or local agency or person substantially affected by the absence of a lead agency designation to request the designation of a lead agency. See 42 U.S.C. § 4336a(a)(4); 40 C.F.R. § 1501.7(d).
• The lead agency may designate a Federal, State, Tribal, or local agency as a joint lead agency. See 42 U.S.C. 4336a(a)(1)(B); 40 C.F.R. § 1501.7(b).
• A lead agency may designate any Federal, State, Tribal, or local agency that has jurisdiction by law or special expertise with respect to any environmental issue involved in a proposal as a cooperating agency. See 40 C.F.R. §§ 1501.7 and 1501.8.
• Any Federal, State, Tribal, or local agency that is participating in an environmental review or authorization of an action is a participating agency. See 42 U.S.C. § 4336a(a)(4); 40 C.F.R. § 1508.1(cc). For example, participating agencies includes lead, joint lead, and cooperating agencies.

How does the rule incorporate Section 109 of NEPA, which allows agencies to adopt and apply another agency’s categorical exclusion?

The final rule provides a clear and simple process for an agency to adopt and apply another agency’s categorical exclusions in 40 CFR § 1501.4(e) by:

• Identifying the existing categorical exclusion(s) in another agency’s NEPA procedures that may cover the adopting agency’s proposed action or category of proposed actions.
• Consulting with the agency that established the categorical exclusion in its agency NEPA procedures (the establishing agency) to ensure the adoption is appropriate. This consultation process also helps ensure that the adopting agency is aware of and follows any process included in the establishing agency’s NEPA procedures necessary to apply the categorical exclusion.
• Providing public notification of:
  • The categorical exclusion(s) the agency is adopting;
  • The proposed action or category of proposed actions to which the agency intends to apply the adopted CE;
  • The process that the agency will use to evaluate for extraordinary circumstances; and
  • A brief description of the agencies’ consultation on the adoption, including the adopting agency’s conclusion that adoption is appropriate.
• Applying the adopted categorical exclusion to a particular proposed action or category of actions, and evaluating the proposal for extraordinary circumstances.
• Publishing documentation of each application of the adopted categorical exclusion to a specific proposed action. For example, agencies may post the documentation to their websites.

Can agencies adopt another agency’s legislative categorical exclusion?

No. Section 109 of NEPA only allows agencies to adopt and use categorical exclusions that another agency has “established” administratively, including those that Congress directs agencies to establish administratively. See 42 U.S.C. § 4336c. The statute does not authorize adoption of categorical exclusions established directly by Congress via statute.

Can an agency adopt more than one categorical exclusion in a single notification of adoption?

Yes. When an agency is adopting one or more categorial exclusions, it may publish a single notification of the adoption.

Can the adopting agency modify the categorical exclusion it is adopting?

No. Section 109 of NEPA does not authorize an adopting agency to modify another agency’s categorical exclusion. Instead, the statute directs the adopting agency to identify the action or category of actions for which it is adopting the categorical exclusion. The action or category of actions for which the agency adopts the categorical exclusion may be narrower in scope than the establishing agency’s categorical exclusion might otherwise encompass. However, the adopting agency cannot modify or change the categorial exclusion in any way.

If any agency has adopted a categorical exclusion for an action or category of actions, and later determines the categorical exclusion could apply to another, similar action or category of actions, can the agency apply the adopted categorical exclusion to those actions?

If an adopting agency later seeks to apply the adopted categorical exclusion to a different action or category of actions than those identified in the notification of adoption, the agency must follow the steps outlined above to adopt the categorical exclusion again for the different action or category of actions.

What should agencies discuss when consulting on the potential adoption of a categorical exclusion?

The consultation ensures an adopting agency will appropriately use an establishing agency’s categorical exclusion.

During the consultation, the agencies should discuss and consider:

• The types of actions to which the establishing agency applies the categorical exclusion and how these compare to the actions or categories of actions the adopting agency is contemplating. This discussion should ensure that the adopting agency’s actions or categories of actions fall within the scope of the categorical exclusion;
• Any litigation that has changed how the establishing agency interprets or applies the categorical exclusion or other public controversy surrounding the establishing agency’s use of the categorical exclusion;
• How often the establishing agency has modified a proposed action to fit the categorical exclusion or prepared an environmental assessment or environmental impact statement for a proposed action instead of relying on the categorical exclusion because of extraordinary circumstances;
• Any processes contemplated in the establishing agency’s procedures to apply the categorical exclusion, for example, such as any conditions or factors required to apply the categorical exclusion; and
• The extraordinary circumstances that the establishing agency considers in applying the categorical exclusion and how the adopting agency will review its own application of the categorical exclusion for extraordinary circumstances. The agencies should discuss whether the adopting agency will apply the establishing agency’s extraordinary circumstances exclusively or both agencies’ provisions. CEQ expects that an adopting agency generally will follow the extraordinary circumstances process set forth in the establishing agency’s NEPA procedures, but the adopting agency may decide that it also will consider the extraordinary circumstances process in its own procedures to ensure it addresses any agency-specific considerations.

What public notification is required for an agency to adopt another agency’s categorical exclusion?

An agency must provide public notification that it is adopting another agency’s categorical exclusion or categorical exclusions. The notification must:

• Identify the specific categorical exclusion or categorical exclusions that the agency is adopting,
• Identify the proposed action or category of proposed actions to which the adopting agency intends to apply the categorical exclusion,
• Describe the process the adopting agency will use to evaluate extraordinary circumstances, and
• Briefly describe consultation between the adopting and establishing agencies. CEQ recommends that the notice state and explain the adopting agency’s conclusion that the proposed use of the categorical exclusion described in the notice is appropriate.

Agencies may publish an adoption notification on their website. CEQ encourages the agencies to publish a notice through the Federal Register when they anticipate substantial public interest in the adoption.

What public notification is required for an agency to apply another agency’s categorical exclusion that it has adopted?

After an agency has adopted a categorical exclusion for a specific action or category of actions, it must document the application of the categorical exclusion to individual actions and publish such documentation. The regulations define the term “publish,” which provides discretion to the agency to choose the appropriate means of making the information available for review by interested persons, including publishing the documentation on its website. See 40 C.F.R. § 1508.1(gg).

Can an agency publish one notification both adopting another agency’s categorical exclusion and applying that categorical exclusion to a particular, discrete action or category of actions?

Yes. If an agency adopts a categorical exclusion for one action or a discrete set of specific actions, and at that time, the agency has sufficient information to consider the existence of extraordinary circumstances, the agency may prepare and publish a single notification that both adopts and applies another agency’s categorical exclusion.

Is a public comment required when an agency is adopting another agency’s categorical exclusion?

Agencies have discretion on whether to invite public comment on adopting another agency’s categorical exclusion. Individual agencies may choose to adopt standards for when they require public comment on CE adoption in their NEPA procedures.

How does the adoption process under section 109 of NEPA and 40 C.F.R. § 1501.4(e) differ from adoption of another agency’s categorical exclusion determination under 40 C.F.R. § 1506.3(d)?

Adoption under section 109 of NEPA and 40 C.F.R. § 1501.4(e) allows an agency to adopt another agency’s categorical exclusion for a particular action or category of actions, and once adopted, the adopting agency can apply that categorical exclusion to future actions that fall within the category of actions identified in its adoption notice.

Adoption under 40 C.F.R. § 1506.3(d) enables an agency to adopt another agency’s previously made determination that a categorical exclusion applies to a proposed action when the two agencies have actions that are substantially the same. Under 40 C.F.R. § 1506.3(d), an agency adopts and relies upon another agency’s specific determination that categorical exclusion applies to a particular action. The adopting agency must determine that the action covered by another agency’s categorical exclusion determination and its own proposed action are substantially the same. For example, an action might involve a permit from one agency and funding from another. In this case, the activities that will follow the agency’s permitting or funding decision are substantially the same, and the funding agency may determine it is appropriate to adopt the permitting agency’s categorical exclusion determination that applies to this common underlying activity. To adopt the categorical exclusion determination in this instance, the adopting agency must document its adoption, including the determination that its proposed action is substantially the same as the action covered by the other agency’s categorical exclusion determination and that there are no extraordinary circumstances present that require the preparation of an environmental assessment or environmental impact statement. 40 C.F.R. § 1506.3(d)(1). The adopting agency must publish its adoption determination on an agency website or otherwise make it publicly available. 40 CFR § 1506.3(d)(2).