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TOM WHEELER:

Welcome to the Econews Report. I'm your host this week, Tom Wheeler, Executive Director at EPIC, the Environmental Protection Information Center. And I have a bunch of guests today. What unites all of these guests is that they're legal nerds. And so when we bring together all of our legal nerds, you know that we're gonna be talking about the law. So joining me is Melody Meyer, Staff Attorney at EPIC. Matt Simmons, Climate Attorney at EPIC. Hey, Tom. Jen Marlow, Professor at Cal Poly Humboldt.

And Scott Greacen, Conservation Director of Friends of the Eel River.

GREACEN:

Hey y'all, don't forget to mention that you too are a lawyer.

WHEELER:

I am. I am. Well, the least accomplished of this venerable group. So we are talking today about NEPA, the National Environmental Policy Act. You might be familiar.

GREACEN:

The National Environmental Protection Act.

WHEELER:

Policy Act.

GREACEN:

I'm joking because that's the way it's constantly miswritten in the press, like the National Forest Service and stuff like that that makes my teeth grate.

WHEELER:

OK, for a second, I thought that I've just been getting this wrong for my entire work career, and I had a moment of panic. OK, so we're talking about NEPA, the National Environmental Policy Act. And you might be familiar with NEPA because it's the thing that gets invoked with things like Richardson Grove, where there is a lawsuit that might challenge the sufficiency of environmental analysis for major federal action. It is one of the environmental movement's favorite tools in our toolbox, and accordingly, it has been the ire of developers, ne'er-do-wells, other folks who want to spoil our environment. So there was a recent Supreme Court case. Let's start there. Matt, what happened in this case?

MATT SIMMONS:

The case is called Seven Counties Infrastructure, and in this case, back in 2020, the Seven Counties Infrastructure Group petitioned the Surface Transportation Board to build a new railroad. The Surface Transportation Board is a federal agency that governs new railroad construction, and so in order to build a new railroad, you have to ask them for permission to do so. Under the National Environmental Policy Act, that federal agency making this decision is a federal action that needs to be considered, and you need to consider the environmental impacts of that decision. So the Surface Transportation Board writes an environmental impact statement. As the opinion points out several times, it is 3,600 pages long, but in this statement, they do not fully consider, or the plaintiffs argue, they do not fully consider the upstream and downstream environmental impacts of this action. And Scott, you have, you would like to say something.

GREACEN:

I'm wondering, what was the purpose of this railroad?

SIMMONS:

I was getting to that because, so depending on who you ask, the purpose either matters or it doesn't matter. So the, the purpose of this railroad was to link the Uinta basin in Utah, which is full of waxy crude oil to the rest of the railroad network, currently there is oil drilling done in this basin, but all the oil is trucked out and so they wanted to build this railroad in order to move lots more oil out of the basin to refineries so that it could be turned into gasoline and all the other things that we use fossil fuels for.

WHEELER:

So, at the heart of this is a question of what is to be considered. So, we have the proposal directly before us, which is merely to construct, merely, it still has significant impacts, to construct 88 miles of railroad line to connect one area to the national network. And then we have what are called the upstream and downstream impacts. So, the upstream impacts are the oil and gas development that might be unleashed as a result of this, developing habitat, whatever sort of impacts.

GREACEN:

... purpose of this ...

WHEELER:

... us. The purpose of this, the purpose of this in the mind of Scott Greeson, which is not an opinion shared by Justice Kavanaugh. And then we have the downstream impacts, which are going to be the generation of petroleum products from this waxy crude oil and the effects, let's say, on our climate from all of this. So we have here a fight over what is the appropriate scope of review. Are we going to take something, a narrow view and only look at that 88 miles? Or should we take a larger view and consider how it's going to facilitate the development of oil and gas and what that facilitation might mean for the health of our climate?

SIMMONS:

And I think another way to put this, and Scott sort of got at this, is do you have to think about the purpose of the railroad? Because I think, he doesn't explicitly say this, but I think in the Kavanaugh opinion, you could be reading it as saying, you don't have to think about the purpose of the railroad, you can just think about the railroad on its own.

WHEELER:

Well, so let's get to the opinion itself. So I feel like we've kind of given away what the Supreme Court does here, but Scott, would you like to say what a student justice Kavanaugh has to say about the appropriate scope of review?

GREACEN:

As I read it, Judge Kavanaugh says that the project itself is the only thing you get to look at. And really, the important thing is you need to defer to the agency in every respect, like how they define the project and how much review it thinks is necessary, which is really interesting in the wake of Loeb or Bright, but you know.

WHEELER:

So Scott, you invoked Loper Bright. We've had shows about this in the past. Would you like to tell us about Loper Bright and why deference to an agency here might be interesting given other recent Supreme Court cases?

GREACEN:

This is hilarious because you have an actual professor on hand and you're asking me to talk about it.

WHEELER:

Okay, alright, Jen Marlow, let's kick the question to you instead.

JENNIFER MARLOW:

Okay, so yeah, I think we can talk about Loper Bright as this recent decision where the US Supreme Court overruled Chevron, which is a doctrine that has governed administrative law for the last 40 plus years, which required courts when reviewing vague statutory language to defer to agencies interpretation so long as the interpretation is a reasonable interpretation of Congress's intent. Loper Bright, by overturning that, has declared that sort of the province of the judicial branch is to provide the best interpretation of the law and no longer is mandatory deference the standard for reviewing agency decisions by courts under Loper Bright.

And so what Scott was saying is that this is a really interesting kind of turn towards Chevron, except the court just ignored the arbitrary and capricious nature of not doing a hard look review of the impacts foreseeable, reasonably foreseeable impacts of the railroad development on oil upstream and also on the disadvantaged communities that are living near the refineries downstream. So it's an interesting kind of reversal of Loper Bright, but just in this particular opinion where the court is going back towards Chevron and saying this is a reasonable interpretation by the agency, we're going to defer to the agency. And so in the seven county infrastructure coalition case, the judicial opinion by the Supreme Court is that the standard of NEPA now is judicial deference to the agency, not hard look under NEPA and also the Administrative Procedures Act. So it's an interesting kind of irony there.

GREACEN:

There is a more cynical way to read this, which is to suggest that the court is looking at the kinds of projects getting reviewed and basically taking the position that the corporations should win.

MARLOW:

Well, it also relies on Chamber of Commerce amicus briefs in its opinion, which is interesting to see that. We saw that a little bit in Sackett, too, where we're looking at the Supreme Court using industry in ways that co-opt the use of science, where environmental review really should rely on science and less on the industry review. And also just a little bemoaning of the impacts of NEPA by Justice Kavanaugh in the opinion, which is unsubstantiated. It just goes on and on. And I think that's another interesting observation here is like, what is the the basis of this opinion? It seems to just be like an annoyance with NEPA rather than like hard evidence that is factually based and also based in the statute itself, which requires a review of not just direct impacts. It doesn't say direct impacts. It says effects in the statute. It doesn't say direct effects. And so we have also sort of a policy decision, again, out of the Supreme Court, which is exactly what we had in Loeb or Bright and lots of other slew of recent U.S. Supreme Court decisions.

GREACEN:

There's a phrase that does not appear in this decision or as far as I could tell in Sotomayor's concurrence, it's cumulative effects. And to me, that's really the heart of modern NEPA jurisdiction and jurisprudence is thinking about those foreseeable effects. In this case, the upstream and downstream effects and the point of NEPA has been to include those cumulative effects. And I read this case to say, no, we don't do that anymore.

WHEELER:

I think that the case can be read narrowly and broadly. And so I will argue for a narrow interpretation of this case, which is maybe it doesn't critically restate federal environmental law that much. So at its heart, Judge Kavanaugh says, you know, it's still permissible to look at indirect effects. You can still look at upstream and downstream effects and what, what governs where we draw the line because we can always create butterfly effect. But for causation is that we have this thing called the rule of reasonableness, which existed prior to this decision. And effectively what they just said here was considering impacts to disadvantaged communities in Louisiana for a railroad that's built in Utah might be outside the bounds of what is reasonable. And so perhaps, perhaps this is less impactful of a case and more just kind of a one-off.

Here I'm trying to do my best Pollyannish interpretation of the law because I know that I will have four grumps on the other side to argue that this is going to be bad. So, so for a grump who's going to tell me that this is going to be bad, would one of, would one of you like to, to say why you think that this is going to be bad?

MARLOW:

I'll do that. I think what we've seen from the Trump administration so far is that they are very much not going to hold back or they're not going to allow their staff to do this analysis that incorporates downstream effects. Even if that's how we would like to interpret this case, we know that the Trump administration is going to take this and run, and we've already seen some things coming out, such as an expedited 14-day review of things like uranium mining and rescinding the Council on Environmental Quality's rules. It's not looking so good. I'm not feeling so positive as you are, Tom.

WHEELER:

So if we set up a system of deference, we have to think about the agencies we are deferring to and the kind of projects that we are going to be deferring on, which in a Trump age is going to be fossil fuel and uranium mining and not the renewable energy projects that someone like climate attorney Matt Simmons might work on.

SIMMONS:

And I was going to say, you know, as climate attorney, I feel like climate change being the environmental crisis of our times, climate change is always a downstream incidental impact of everything you do, right? Like, it's, it's always attenuated to some extent, because you burn the carbon in one place, not polar ice caps melt in a different place. And so part of what this decision is saying is that it's going to be very, very difficult for an agency to successfully argue that it should be looking at climate impacts. And so when you combine that with the CEQ regs, getting repealed, we're now getting judicial opinions and regulatory opinions, both pointing towards not thinking about climate change in agency environmental review. And at a time when climate change is the thing most threatening our environment, that's pretty absurd, I think.

WHEELER:

I will note Matt said something about the CEQ regs being repealed. What that is in reference to is the Council on Environmental Quality, which is an office within the White House, had traditionally issued regulations to interpret NEPA. And early in this Trump term, the second Trump term, they have moved forward with a rule making to just delete all of those regulations so that we won't have any sort of centralized NEPA regulations that cross over all government agencies. The idea is that each government agency is going to issue their own new interpretations on how to interpret NEPA. So you might see rules from the Bureau of Land Management or the Bureau of Livestock and Mining that are more favorable to things like livestock and mining.

MARLOW:

Yeah, and the administration not only said they were going to rescind the regulations, the CEQ regulations, they instructed all federal agencies to promulgate regulations that would expedite environmental review and that would increase the efficiency of environmental review. So that's something to consider as well.

WHEELER:

You are listening to the Econews Report. We're talking about NEPA, the National Environmental Policy Act. And so when we bring together all of our legal nerds that we're going to be talking about the law. So, so that perhaps is, is this, this feels like a, a, a reflection of this time that we're in right now where permitting reform is a big topic, both on the right and on the left. So on the right, you have the usual suspects, the chambers of commerce and so on, who are excited about it. On the left, we have a new ascendant permitting reform class led by folks like Ezra Klein or gosh, what's her name? Dumas from the Atlantic.

SIMMONS:

Whatever. Jerusalem demsas. Whatever.

WHEELER:

There we go. Matt, Matt is so much smarter than I am. Folks who argue that it was the right inclination to do things like robust, hard look NEPA, but that trying to do what's best for the environment is getting in the way of things like renewable energy projects. So, so this is, this is something that's coming from, from both directions on things like NEPA or it's California equivalent to the California Environmental Quality Act or CEQA, Jen.

MARLOW:

I was just going to say, based on your narrow reading, I would like to read it narrowly, too, and I'm wanting to do that. I'm also wondering, the downstream effects, I can see attenuation there. I can see some of those arguments. The board said they didn't know exactly which refineries it would go to, and there were some uncertainties around that. And at the same time, though, if you look upstream, I think the upstream impacts of the railroad construction are way, are much, they didn't give enough of a good reason why they could not examine the upstream impacts on vegetation and habitat of the railroad development. I think that if the court was really careful here, it would have made a different analysis, or it would have analyzed the upstream impacts differently. Because to me, I think the downstream impacts are challenging in this way that you described, with attenuation.

Although I also agree with Matt that we can't ignore the downstream impacts of projects associated with oil development, even if the board, the surface transportation board, doesn't have jurisdiction over the permitting of the refineries. But at the same time, if you think about other analogies in environmental law, I would say the surface and transportation board shouldn't have to consider an oil spill in the Colorado River, because it doesn't have, the EPA has jurisdiction over the Clean Water Act, not the board. And so it starts to feel a little senseless when you disaggregate all these jurisdictional responsibilities, when environmental law is multimedia, it's multi-jurisdictional, it's multi-state. Even the fact that it's downstate of Texas and Louisiana, we have multiple cases with precedents saying downstream impacts are actionable violations of statutes. And so I think it's just a, it's hard to say whether this is narrow or not, just because I think the court could have done a better job if it wanted to be narrow in analyzing the upstream impacts differently than the downstream impacts, if that makes any sense.

WHEELER:

That does make sense. And I think it's going to be an interesting project for environmental litigators to attempt to resuscitate any good that they can out of this decision. One thing that I'm interested in is I think that the Supreme Court has reaffirmed, in some sense, indirect impacts, which was something that the Trump administration has been wanting to get rid of through their NEPA rule makings, this idea that we could consider at all cumulative impacts or indirect impacts is a subject of debate amongst megatypes. And here, we have an affirmation that these can be part of NEPA, that they are part of NEPA, but that they're still going to be governed by some sort of vague rule of reasonableness that we're going to give significant deference to agencies in determining what isn't reasonable. So maybe there's still something there. I know that Scott probably disagrees with me, and had a point earlier that he would like to probably raise.

GREACEN:

I want to throw in one other little factual point on the downstream end of the impacts, which is the observation Sotomayor notes that the estimated greenhouse gas consequences of developing new inter-basin waxy crude are something between four hundredths and one tenth of a percent of the total global emissions. So one tenth of a percent is about the same amount that Sweden and Ireland are responsible for. So I would suggest that if a federal project or an action is implicated in the kind of impacts that a sovereign country might be duly concerned about, that that qualifies.

WHEELER:

I like measuring greenhouse gas impacts too, in terms of like one Ireland or one Sweden. As an American, I refuse to use any sort of normal system of measurement, so I'm going to start using this.

GREACEN:

Which is to say, 150th of North Dakota. Yeah.

WHEELER:

Oh, so.

SIMMONS:

We've talked about the Sotomayor concurrence. Maybe we should explain why it's a concurrence.

WHEELER:

We have an 8-0 opinion, but in reality, it was more...

GREACEN:

One that's not there.

WHEELER:

What else about good ol' Neil Gorsuch?

GREACEN:

Yeah, and why is he so close to Philip Anschutz, massive oil baron, whose interests are directly affected in this case, that he had to recuse himself? I mean, it is a corrupt court. It's nice of Gorsuch to recuse himself, but the fact that their interests are woven in together with the oil and gasoline is really appalling.

WHEELER:

And that we have to thank Gorsuch et al. to recuse himself in a situation like this, given Justice Thomas's refusal to recuse himself in many other very similar situations, is that that's newsworthy or remarkable or praiseworthy is itself a sad condemnation of this court. Okay, so we had eight zero opinion. So a unanimous court of justice is saying to hear the case in favor of allowing this project to move forward under its existing NEPA documents and finding it to be sufficient. But in reality, it was a divided court. It was a five-three decision where we had the five conservative justices joining Judge Kavanaugh's majority opinion. And then we had three judges, the liberal members of the court, not writing in dissent, but writing in concurrence. Matt, tell us about what writing in concurrence means and how they would have alternatively handled this case.

SIMMONS:

Sure. So when you read a Supreme Court decision, it matters for two reasons, right? It obviously matters the judgment of the case and what's going to happen with this particular railroad, but it also matters for what law is created by the decision. And the three liberal justices for the concurrence where they would have found in favor of the railroad being able to proceed with the EIS without considering these upstream and downstream effects, but they tried to do so on a even more narrow grounds than the Kavanaugh majority did. And my reading of it was that they were very focused on the different agency having final approval over the other actions and that that was the line that should be drawn. And we actually have already talked about how that line has some problems, but maybe it is a cleaner line to draw and is at least sort of a place to look.

WHEELER:

Can I re-say what you're saying? Yeah. So they said the Surface Transportation Board didn't have the ability to reject a railroad because of things like greenhouse gas impacts, which itself is a debatable point, I would say.

SIMMONS:

Well, no, I think it was they don't have the ability to regulate the refineries in New Orleans, and they don't have the ability to regulate oil drilling in the basin. And because they can't regulate those things, it wasn't required for them to think about it as much in this opinion. That was, that was the line Sotomayor wanted to draw.

MARLOW:

They also said they don't have the ability to decide what cargo goes on the train. They can't deny if they want to do crude oil or solar batteries. They don't have a choice on that.

WHEELER:

So I know somebody here has previous experience working with the surface transportation board and has a local example of.

GREACEN:

over our different phrases, Tom. But yeah, I wanted to raise our previous experience with the coal train that nearly happened, because I think it's a cautionary tale here. Listeners may remember that before the Great Redwood Trail finally was able to begin its process of coming into being, the former North Coast Railroad Authority had to complete a process of service transportation board approval to move the line into rail banking so we could turn it into a trail. And at that point, there was a proposal on the table from a mysterious group of investors that we came to understand at the time included coal interests from the Rocky Mountains, from Wyoming, who wanted to use the Eel River rail line to transport coal to Humboldt Bay. We could well have been in a place where that operation was the focus of an environmental impact statement that the Supreme Court was ruling on here. And the downstream impacts of coal burned in China would have been the issue, the global warming impacts on Humboldt Bay, the impacts on Wyoming of digging up that coal. And you can maybe see in a slightly different frame how that same case would have come out with the same ruling, but with no less injustice, let me say.

And for me, what that highlights is that the line in here that Justice Kavanaugh suggests that the oil refineries of the Gulf Coast are highly regulated and so couldn't possibly be the source of environmental harm. I guess the thing I wanted to point out that I missed there is that the Surface Transportation Board jurisdiction means that there's no possibility of state or local review. There's no possibility of state or local regulation or protection for anything. You only get what the Surface Transportation Board gives you, and they don't give you very much at all.

WHEELER:

Okay. So we've talked about the case itself. We've talked about the legal reasoning. I think one of the things that we've left unaddressed is what is going to be the long-term consequence of this case. We've kind of spoken a little bit about this, Jen, how, how this case becomes interpreted by lower court. Seems like it's going to be important. Can you talk about like what comes next and how much this case might matter and how we'll be able to understand what the long-term impact of this case might be?

MARLOW:

I think it's going to be a long-term impact of a suite of decisions that wrestle with this case, along with what Melanie had already earlier suggested around the CEQ rescinding of the regulations that impact all agencies, how do courts interpret cases that exclusively rely on NEPA, the statute, like this one, versus how courts review cases that relied on the CEQ regs, and so there's going to be a divide in that regard, and there's going to be inconsistent opinions based on those decisions, or different interpretations depending on whether the CEQ regulation was relied upon or not.

I think there's some other question around the consideration. If you just have to consider the indirect or cumulative impacts but don't have to analyze them, to my mind, it really interferes with this long-standing question of what the substantive effects of NEPA are as a procedural statute, and we saw earlier case law where there's a lot of even dissenting opinions where Justice Thurgood Marshall was saying courts aren't just doing, quote, the mindless task of determining whether an agency considered environmental factors, it's more than that, I hope, and this case makes me question whether we'll get by with courts just doing the mindless consideration of the 3600-page EIS and calling that good, and the lack of real close factual evidence-based determination based on the upstream impacts versus the downstream, I just don't see that careful execution of the hard look that I think is arbitrary and capricious. My question is going to be how long does this case stay precedent? How do we get arbitrary? What is arbitrary and capricious now under the APA and hard look? What happens to that in future NEPA case law?

I'm curious to see, and maybe in a different context, if it's not oil, maybe there's different contexts in which NEPA decisions are interpreted differently if there's a favorable, if courts look favorably on some industries versus others, that would be interesting to see as well.

WHEELER:

So maybe the trick to resuscitating NEPA is to challenge something that conservatives really hate, you know, offshore wind, then, then we'll, then we'll once again, have robust environmental analysis where we have to consider things like do offshore wind turbines cause cancer. So, so, so look for that case. I'm sure coming into the future, regrettably, we are out of time. This has been another legal nerd edition of the Econews Report. I think that this has probably convinced everyone listening that they should not go to law school and that they made the right decision by not becoming a lawyer. But I want to thank the people who are here. Matt Simmons, Melody Meyer of EPIC. Thank you so much. Jen Marlowe of Cal Poly Humboldt and Scott Greacen of Friends of the Yellow River. Thank you so much for joining the show.

Thank you all. And thank you listeners and join us next week for more environmental news from the North coast of California.