GM 12-045

BIA Proposes Categorical Exclusion for Homesites

Assistant Secretary – Indian Affairs Larry Echo Hawk has announced a proposal intended to expedite compliance with the National Environmental Policy Act (NEPA) for actions by the Bureau of Indian Affairs (BIA) associated with leasing and/or constructing a home on Indian land. The announcement was made in a “Dear Tribal Leader” letter dated March 7, 2012 (copy attached). The proposal would revise the BIA’s NEPA implementing procedures by adopting a new categorical exclusion. Comments are requested by May 14, 2012, which is prior to the publication of the proposed rule in the FEDERAL REGISTER. By asking for comments by May 14, the BIA can take them into consideration in any revisions to the current proposal. The proposed wording is as follows:

“Approvals of leases, easements, or funds for single-family homesites and associated improvements, including, but not limited to, homes, outbuildings, access roads, and utility lines, which encompass five acres or less of contiguous land, provided that such sites and associated improvements do not adversely affect any tribal cultural resources or historic properties and are in compliance with applicable Federal and tribal laws.”

The practical effect of adopting this new categorical exclusion would be that compliance with NEPA would no longer require an environmental assessment (EA). In addition to reducing the time needed for BIA approval, this should void the costs associated with preparing an EA.

The Purpose of Categorical Exclusions in the NEPA Process

The basic requirement of NEPA is that every federal agency must prepare, or have prepared for its use, an environmental impact statement (EIS) before authorizing any federal action “significantly affecting the quality of the human environment.” 42 U.S.C. § 4332(2)(C). The statutory requirement of NEPA is implemented through regulations issued by the President’s Council on Environmental Quality (CEQ). 40 C.F.R. parts 1500 – 1508. In addition, each federal agency is required to adopt procedures to implement certain provisions in the CEQ regulations.

Under the CEQ regulations, rather than prepare an EIS, a federal agency can use a less-detailed document known as an environmental assessment (EA) to determine whether or not a proposed federal action is likely to result in significant environmental impacts. If so, the proposed action then requires an EIS. If not, the responsible federal official can sign a finding of no significant impact (FONSI), which satisfies the legal requirement for compliance with NEPA.

The concept of “categorical exclusion” provides a more streamlined method for achieving NEPA compliance than an EA and FONSI. When a proposed federal action fits within a categorical exclusion, compliance with NEPA does not require the preparation of an EA. (That is, unless an “extraordinary circumstance” applies. The concept of “extraordinary circumstances” is discussed below.)

The basic reason that the CEQ regulations authorize the use of a categorical exclusion is to allow the NEPA process to focus time and resources on the analysis of proposed federal actions that have the potential to cause significant impacts. The statute does not require an EA and FONSI; rather, an EA is a tool devised by the regulations for determining whether the statute requires an EIS. The concept of a “categorical exclusion” recognizes that, if there are categories of federal actions for which an EA never (or almost never) leads to a decision that an EIS is required, the available time and resources might be better used analyzing proposals that do have the potential to cause significant impacts.

Categorical exclusions are authorized, but not established, by the CEQ regulations. Rather, they are established by each agency’s NEPA implementing procedures. As defined in the CEQ regulations, a categorical exclusion is:

“a category of actions which do not individually or cumulatively have a significant effect on the human environment and which have been found to have no such effect in procedures adopted by a Federal agency in implementation of these regulations (§ 1507.3) and for which, therefore, neither an environmental assessment nor an environmental impact statement is required. An agency may decide in its procedures or otherwise, to prepare environmental assessments for the reasons stated in§ 1508.9 even though it is not required to do so. Any procedures under this section shall provide for extraordinary circumstances in which a normally excluded action may have a significant environmental effect.”

40 C.F.R. § 1508.4. For bureaus and offices within the Department of the Interior, the Department-wide list of categorical exclusions is found at 43 C.F.R. § 46.210. Categorical exclusions specific to BIA are found at 516 DM § 10.5. When formally adopted, this is where the new categorical exclusion will be published.

Extraordinary Circumstances

The concept of “extraordinary circumstances” is used as a kind of screening device to catch actions that are normally excluded but that nevertheless may have a significant environmental effect. For bureaus and offices within the Department of the Interior, the list of extraordinary circumstances is found at 43 C.F.R. § 46.215. This list is largely based on the definition of “significantly” in the CEQ regulations. 40 C.F.R. § 1508.27. If the responsible federal official determines that any extraordinary circumstance applies, then an EA must be prepared. As a general rule, there must be some documentary record that the responsible federal official considered the possibility that an extraordinary circumstance applies and has ruled it out. The BIA has customarily used a two-page checklist for this purpose.

Several of the extraordinary circumstances are intended to ensure consideration of resources that are protected by other laws, including the Endangered Species Act (ESA) and the National Historic Preservation Act (NHPA). When a federal agency treats a proposed action as a categorical exclusion and signs off on a checklist finding that no extraordinary circumstance applies, that does not render laws such as ESA and NHPA inapplicable. Rather, such statutes apply independently of NEPA, and compliance with ESA and NHPA must generally be achieved before the federal official signs the checklist.

Commentary on the Proposed Categorical Exclusion

The proposed categorical exclusion will most likely have the desired effect of expediting BIA approvals of leases and other actions to authorize single-family homes on trust land. Questions might be raised regarding why the threshold land area is set at five acres in the aggregate. This may well be a reasonable threshold, but no explanation for it is provided in the “Dear Tribal Leader” letter. Similarly, if five acres is assumed to be the appropriate threshold, questions might be asked regarding the limitation to single-family homes, for example, why not also cover multi-family residential buildings or mixed-use developments?

Questions might also be raised regarding how well the screening process for extraordinary circumstances will work in practice. Will the screening process be a mere paperwork exercise or a good faith effort to determine whether an extraordinary circumstance applies? In this regard it should be noted that, as proposed, the categorical exclusion requires compliance with applicable tribal laws, which gives tribes a way to assert some control over this screening process.

It should also be noted that, as proposed, the new categorical exclusion does not apply if the proposed BIA action would “adversely affect any tribal cultural resources or historic properties.” This is broader than the relevant DOI extraordinary circumstance, which is triggered by proposed actions that may have “significant impacts on properties listed, or eligible for listing, on the National Register of Historic Places as determined by the bureau.” 43 C.F.R. § 46.215(g). The proposed new categorical exclusion is triggered by adverse effect (whether or not “significant”) and includes “tribal cultural resources” as well as “historic properties.” Whether the screening process works in practice to catch adverse effects to tribal cultural resources will likely turn on whether there is a program established under tribal law.

Finally, there may well be other categories of BIA actions that should be added to the list of categorical exclusions. Any such suggestions should be brought to the attention of BIA. One example of a kind of lease that might be considered for a categorical exclusion is a wind energy evaluation lease (WEEL), a new kind of lease that would be authorized by a new Subpart E in the BIA’s revised leasing regulations. 76 Fed. Reg. 73784 (Nov. 29, 2011) (publication as proposed rules). A WEEL is a short-term lease for evaluating the wind energy potential of a site, not for the installation of wind turbines; the environmental impacts of a BIA action authorizing the installation of wind turbines would be a separate matter for NEPA compliance.

If you would like further information regarding the proposed categorical exclusion for single family homesites, please let us know.