Who Pays for the Impact Statement? Two Circuits Uphold Agency Authority to Assess EIS Costs Against Licensees

November 1979
Citation:
9
ELR 10204
Issue
11

When Congress, in §102(2)(C) of the National Environmental Policy Act (NEPA), directed federal agencies to prepare an environmental impact statement (EIS) for every environmentally significant major federal action, it could hardly have foreseen the voluminous "detailed statement" that the federal courts would soon require agencies to produce. Modern impact statements have been known to occupy a foot or more of shelf space and cost as much as $100,000 to prepare. Such costs have been justified on the basis of the resulting improvement in agency decisionmaking and in project design. When expensive EISs must be prepared in connection with a private party's application for a federal permit or license to conduct private activities, these studies, preparation of which remains the legal responsibility of the federal agency, begin to resemble federal subsidies to the project sponsor. Recognizing that assessment of the cost of EIS preparation against license applicants works to internalize this expense to the project rather than simply pass it along to the taxpayers, several agencies have begun to require that applicants reimburse them for some of these costs. Recently, the first two federal courts of appeals to address the issue held that in certain circumstances agencies may under existing law require reimbursement from licensees for such expenses. While this practice, if widely accepted, may add relatively little in percentage terms to the final cost of major private projects, it may nevertheless in some instances have a significant impact on the sponsor's cost-benefit calculation.