The U.S. Supreme Court appeared open to diminishing the scope of how federal agencies consider environmental impacts Tuesday in a case centered on a proposed oil railway in northeastern Utah.
The 88-mile Uinta Basin Railway, if built, would connect the remote, oil-rich Uinta Basin to the rest of the country and refineries on the Gulf Coast. The railroad could quintuple the region’s oil exports, according to a 2021 environmental review.
The federal Surface Transportation Board, which regulates interstate rail transportation, approved the railway’s construction in 2021. But Eagle County, Colo. and environmental nonprofit Center for Biological Diversity sued, arguing that the board did not fully analyze the railroad’s potential effects on communities on the Gulf Coast, where many oil refineries are located and Utah’s oil is likely to go for processing, among other things.
Last year, a lower court sided with the county and environmentalists, throwing out the approval.
The Seven County Infrastructure Coalition, the public partner for the railway representing seven resource-rich counties in eastern Utah, appealed the decision to the Supreme Court. It asked the court to take a closer look at what the National Environmental Policy Act, or NEPA, requires in environmental reviews. The Supreme Court agreed to hear the case in June.
Several of the justices questioned what environmental impacts federal agencies should have to consider.
Environmental reviews should not thwart projects, railway supporters say
Federal agencies should not have to consider environmental impacts that are “remote in time and space” and “within the jurisdiction of other agencies,” argued Paul Clement, a lawyer for the Seven County Infrastructure Coalition. His law firm, Clement & Murphy, also is representing Utah in its costly Supreme Court challenge of federal lands.
Justice Ketanji Brown Jackson, one of the court’s liberal justices, said she felt this argument is “unmoored from the purposes of NEPA” and that limiting the scope of environmental review to the railway’s 88 miles is too narrow.
Clement responded that federal agencies can look at broader effects, but that considering environmental impacts beyond the project itself — such as impacts on Gulf Coast communities — should not prevent projects like the Uinta Basin Railway from being built.
Instead, he argued that NEPA reviews should help an agency understand alternative ways to implement a project and what mitigation measures can make it more environmentally friendly.
The Surface Transportation Board is only charged with approving a railroad to carry cargo, and the fact that this railroad’s cargo — waxy crude oil — may have environmental effects on Gulf Coast communities should not impact whether or not the agency approves it, Clement said.
Rather, he argues, other federal agencies and the Gulf Coast’s local governments would be better suited to confront increased oil refinement. And as to how increased oil development motivated by the railway would affect the Uinta Basin, he said, Utah entities should make those decisions, not the Surface Transportation Board.
Agencies must consider ‘foreseeable’ environmental effects, opponents contend
William Jay, representing Eagle County and environmental groups opposing the railway, argued that NEPA requires federal agencies to consider “foreseeable” environmental impacts of projects — and that those considerations may lead to denying projects.
Jay argued that the Surface Transportation Board must consider the environmental effects of oil refinement because the purpose of the Uinta Basin Railway is to move crude oil from Utah to the Gulf Coast for refinement.
He explained that the Uinta Basin Railway is a rare case, since the railroad would transport a single commodity to a single location — oil to the Gulf Coast. Most federal projects are less specific.
Several justices were skeptical of Jay’s argument that oil refinement on the Gulf Coast should inform the Surface Transportation Board’s environmental review and final decision on whether or not to approve the railway.
Jackson pressed what she believed is the “hardest” question: If the railway’s adverse environmental impacts are caused by oil, and the Surface Transportation Board cannot discriminate against that cargo, “then how is it that these environmental impacts are useful to the board’s decision-making in the way that NEPA requires?”
Jay said that since the Surface Transportation Board was able to quantify the amount of oil that would need to be transported by the proposed railway in order to make the railway financially viable, the agency assumed the oil would be refined.
“Under those circumstances where the rationale for the project is to permit unlocking more waxy crude oil development and where the board’s consideration of the benefits of the project is tied to that oil development, Jay said, “it follows that the board would at least consider what the environmental effects of doing so would be.”
Wendy Park, a senior attorney for the Center for Biological Diversity, said “there was a lot of confusion during oral arguments about the rule the project’s backers want the court to apply” in a statement after the hearing.
“They’re asking the justices to limit environmental reviews to the effects that are within an agency’s regulatory authority and project footprint. This conflicts with NEPA’s plain text,” she added, “and would undo decades of precedent at the expense of our communities, public health and the environment.”
Should the Supreme Court side with the railway’s backers, the project would still require additional permitting and reviews before it can be built.
