This month there was new activity in the ongoing effort to re-order the environmental process for federal actions, responding to changes in law, regulations, and judicial interpretation. On July 3, USDOT released revised NEPA implementing procedures in coordination with the updates to procedures at numerous other agencies.  

The regulatory updates were released as interim final rules rather than through a Notice of Proposed Rulemaking on the basis that the rescission of the Council on Environmental Quality’s regulations left a gap in terms and references within the Department’s regulations, and further because the Supreme Court’s recent Seven County Infrastructure Coalition v. Eagle County ruling clarified the purely procedural nature of NEPA. For that reason, these rules implementing NEPA are “not ones that impose substantive environmental obligations or restrictions” and therefore not subject to notice and comment requirements. Moreover, as the agencies succinctly put it, “comment is not required because good cause exists to forego it.” Nonetheless, “out of an abundance of caution”, public comments will be accepted and may be considered. 

USDOT released two new rules: an update to the joint NEPA implementing regulations at 23 CFR Part 771 that governs implementation of NEPA by the Federal Highway Administration, Federal Transit Administration, and Federal Railroad Administration, and an update to the USDOT-wide Order 5610.1D on NEPA implementation. 

FHWA-FTA-FRA Joint Procedures Update 

The prior update to the joint FHWA-FTA-FRA 23 CFR Part 771 implementing procedures was released in the prior Trump Administration a mere 7 years ago, so the changes in this new update were limited. Updates predominantly reflect the amendments made to title 23 by the Infrastructure Investment and Jobs Act (IIJA) in 2021, the amendments made to NEPA in the Fiscal Responsibility Act BUILDER provisions in 2023, and the changes to NEPA rendered by court decisions in the past 9 months. So for instance, references to impacts are consistently changed to “reasonably foreseeable” impacts. An important improvement for FRA allows the agency to incorporate planning studies and alternatives analyses into their NEPA document that were developed as part of the passenger rail planning process that FRA conducts under the Corridor Identification and Development Program. 

1. The revised rule also states affirmatively that the question of whether an impact rises to the level of “significant” is a matter of the OA’s expert judgment, clearly building on the Seven Counties ruling. Notably, the regulations also signal an intent for future changes, stating that “The agencies intend to pursue a future deregulatory rulemaking to further expedite the environmental review process.”  

USDOT Order 5610.1D 

In contrast to recent revisions to the Part 771 regulations, the DOT Order 5610 has not been updated since 1985, despite several attempted updates that were not finalized. The original DOT Order 5610 from 1979 predated the operating administrations’ agency-specific implementing procedures; it functioned as a policy framework for NEPA implementation at USDOT and directed the OAs to develop more specific regulations in alignment with that framework.  

The updated USDOT Order also includes an appendix of updated agency-specific implementing procedures for the Federal Motor Carrier Safety Administration, St. Lawrence Seaway Development Corporation, Pipelines and Hazardous Materials Safety Administration, and the Maritime Administration (MARAD). Most of these agencies’ procedures have been updated somewhat recently but for MARAD this is the first update to their implementing procedures since 1985, despite significant changes authorities in recent years and expansion of capital grant administration responsibilities. (Until the BUILDER Act passed and allowed general borrowing of Categorical Exclusions, MARAD uniquely enjoyed a regulatory provision from 1985 allowing them to borrow other agencies’ CEs, and the risk that the provision would be removed in a revision undoubtedly weakened any interest in updating the procedures.) 

For the USDOT OAs, during the forty years since the release of the previous DOT NEPA Order, their agency-specific procedures and regulations have become more significant and impactful than the DOT order itself. (The joint implementing procedures from FHWA, FTA, and FRA have also been legislatively amended by every reauthorization bill since MAP-21, to the point that there are now inconsistencies between NEPA as amended by the BUILDER Act, and Title 23, and in their regulations the agencies simply list the two different legal requirements for timelines and page lengths.) However, certain changes in this revised DOT Order, particularly in light of other changes at the Department, could make the document more significant. 

NEPA Implementation by OST 

One potentially significant change in the DOT Order could result for the Office of the Secretary of Transportation (OST). Although OST is not typically considered an operating administration, this Order defines OST offices as OAs for purposes of the order, e.g. for implementation of NEPA. The 1985 Order lacks definitions but also appears to envision that Secretarial offices could serve as lead agencies under NEPA, but it has not been the practice for them to do so and OST has never released their own NEPA implementing procedures.  

Yet OST’s lack of ability to implement NEPA has arguably become a challenge in light of the growth of discretionary grant and loan programs administered by OST. Once they decide on grant awards, OST must assign the NEPA review and implementation to one of the OAs to lead, and that OA then typically administers the funds and applies regulatory structures as though the funds were provided under their own grant programs. This can apply legal requirements that may pose challenges, particularly for the kinds of multimodal projects that are often funded by OST grants and loans. 

Expansion of Non-Federal Actions 

Recognition as an OA is all the more important due to the discretion and authority that the Order confers to OAs, specifically about determining whether actions are subject to NEPA at all.  The Order emphasizes that an action must be both major and federal, and further encourages OAs to look for activities that are “presumptively exempt from NEPA.” The Order includes the specific suggestion to “consider whether a threshold could be established for ‘minimal’ federal funding of involvement, such as a monetary or percentage threshold, that would exempt those activities from NEPA.”  (FHWA does already have a monetary threshold for categorical exclusions but it was set by law.) 

One area that is likely to be a major question will be whether providing loans from USDOT will be considered a major federal action. The 1985 DOT Order explicitly included loans and loan guarantees as actions subject to NEPA requirements, whereas the updated order has removed that language and is silent on loans. However, the Order repeats the Supreme Court’s insistence that “a but-for causal relationship is insufficient to make an agency responsible for a particular action under NEPA” and further that “minimal federal funding or involvement… does not by itself covert that action into a Federal action.” The Order makes clear that the OA has the authority to determine if a proposed action is subject to NEPA, as well as the scope and appropriate level of NEPA review of that action if it is. 

Reducing Public Comment and Mitigation Requirements  

The Order also contains other apparent departures in policy that may be significant. With regard to public comment, the Order notes that  “NEPA does not require that a [Draft [Environmental Impact Statement (DEIS)] to be published for comment, though also noting that some OAs may have their own statutory requirement for public comment. Although technically not a change from the 1985 Order, which did not include a blanket requirement for public comment on the DEIS, this is a departure in practice including compared to the language in the 2020 proposed order, which stated that “the OA must make the DEIS available with an invitation to comment to… the public.” 

Similarly with regard to mitigation, the Order pares back recent policy. In 1985, the Order required OAs to “identify… measures to mitigate adverse impacts” as part of an EIS. Mitigation policy requirements and the concern about enforcing those mitigating commitment grew in the intervening years, with the 2020 the proposed Order  requiring the Record of Decision to “identify those mitigation measures that avoid, minimize, or compensate for effects caused by a proposed action or alternatives as described in an environmental document” and further requiring the OA to ensure that mitigation commitments were implemented including by conditioning funding agreements, permits or approvals on the performance of mitigation commitments.  

In the 2025 Order, the requirement for an EIS to include discussion of “any means identified to mitigate adverse environmental impacts of the proposed action” but discussion on enforcement has been removed. Instead the Order directs OAs to “be mindful in this respect that NEPA itself does not require or authorize the OA or an applicant to impose any mitigation measures” and further notes that “while NEPA requires consideration of mitigation, it does not mandate the form or adoption of any mitigation.” 

Finally, in a change from both recent practice and the 1985 Order, the newly updated Order extends the time before a document becomes “stale” and needs to be revisited.  Current practice has been to require a written re-evaluation of the final EIS if more than three years have passed since its publication and no major steps have been taken to advance the project, and that timeline is still reflected in the FHWA-FTA-FRA joint regulations, but the DOT Order now allows a document to be relied upon for five years without requiring a reevaluation of the data and analysis. 

Fee for Expedited NEPA 

Meanwhile, in the same week that agencies released new rule to update their regulations to reflect legal changes, Congress enacted additional amendments to NEPA as part of the budget reconciliation bill entitled the “One Big Beautiful Bill Act.” This new section of NEPA allows an applicant to pay for the preparation of a NEPA document in exchange for shortened review timelines (1 year for an EIS and 6 months for an Environmental Assessment.) Earlier versions of the text had also included an exemption from judicial review for projects that had paid for their reviews, but that language did not survive the Byrd bath presumably because the policy impacts exceed the budgetary impacts, so the judicial limitation does not appear in the final text.  

Interestingly, amid the regulatory retreat of the Council on Environmental Quality, this new provision of NEPA fees places CEQ in a central role. Project sponsors will submit their project description and declare their intention to participate in the program to CEQ, who then determines the amount that is 125% of anticipated costs. The language is also silent on the account into which such funds are to be deposited, and if the funds are to be received by CEQ, whether –and what percent of funds—CEQ will transfer to the lead or participating agencies.