In brief...
The Supreme Court’s Seven Counties decision narrows NEPA’s scope by limiting required environmental reviews to impacts within an agency’s regulatory authority. This decision will likely shift, rather than eliminate, litigation risk and reinforces the role of state and local laws in shaping project outcomes.
Introduction
Considered the “magna carta” of environmental law, the National Environmental Policy Act (NEPA) requires that agencies incorporate environmental considerations into major federal actions. While NEPA does not impose substantive environmental constraints on federal projects, it does require that agencies take a “hard look” at the potential impacts of projects and engage in a transparent decisionmaking process. Over time, litigation has expanded the scope and complexity of environmental reviews, which has prolonged the process and elevated compliance costs. This has raised the question of whether NEPA has evolved from a public disclosure law to a tool used to block projects altogether. This tension was central to the May 2025 decision in Seven County Infrastructure Coalition v. Eagle County in which the Supreme Court addressed the question of how far agencies must go when evaluating the environmental effects of major federal infrastructure in the NEPA review process.
The case originated in 2020, when the Seven Counties Infrastructure Coalition applied for approval of an 88-mile stretch of railway in Utah. Following the review process and project approval, Eagle County, Colorado alongside environmental groups challenged the approval in the DC Circuit. The court found that the Surface Transportation Board (STB) acted arbitrarily and capriciously when it failed to quantify the downstream effects of increased oil and gas production. The case was subsequently appealed to the Supreme Court, which on May 29 overturned the DC Circuit’s ruling, finding that agencies were not required to assess the effects of actions beyond what they had the authority to regulate. This decision may signal a movement away from the expansive interpretations of NEPA frequently adopted by lower courts.
While commentators have subsequently argued that this decision may lead to a narrowing of the scope of NEPA reviews and a more expeditious review process, the effects on the rollout of infrastructure projects will likely depend on how the case affects the incentives of litigants to challenge projects. Likewise, rather than challenge projects under NEPA, litigants may instead opt to challenge under a different land-use or environmental statute, either federal, state, or local, underscoring the importance of all levels of government in the permitting process. Ultimately, the Seven County decision highlights the balancing act between ensuring thorough environmental review and preventing procedural delays, leaving open how agencies, courts, and litigants will navigate NEPA’s evolving role in the years ahead.