Don't Gut Worst Case Analysis

Nicholas C. Yost

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— The Edisotrs

Mr. Yost is an attorney for the Center for Law in the Public Interest in Washington, D.C., and formerly was General Counsel, Council on Environmental Quality, Executive Office of the President, from 1977 to 1981, with lead responsibility for drafting the CEQ NEPA regulations.

[13 ELR 10394]

The Council on Environmental Quality (CEQ) recently issued a proposed memorandum, 48 Fed. Reg. 36486 (1983), for federal agencies concerning the implementation of CEQ's "worst case anslysis" regulation, 40 C.F.R. 1502.22, ELR REG. 46023, promulgated under the National Environmental Policy Act (NEPA). The regulation provides for a "worst case" analysis in environmental impact statements (EISs) in rare but important circumstances. The basic requirements of the rule are simple — if an agency would like to do something which may have severe environmental consequences and it does not know what the effects will be and either cannot find out (i.e. it is beyond the state of the art), or is unwilling to pay the cost of finding out, it must at least determine and take a look at the worst that might happen before it plunges ahead. The proposed guidance memorandum would create an "initial threshold" of "reasonably foreseeable impacts or effects" before a "worst case" analysis would be required. "Potential adverse impacts" with an extremely low probability of occurrence would not be subject to analysis because they do not meet the threshold.

At first blush, any proposal calling for reasonable foreseeability is compelling. For several reasons, however, the proposal is not a reasonable interpretation of the worst case rule and is, indeed, downright harmful. It would not only gut the purpose of the rule, but is contrary to existing case law and previous CEQ interpretation of the rule, and to judicial interpretations of NEPA prior to the rule's promulgation.

Gutting Worst Case

First, and most basically, the effect of the proposal would be to gut the concept of worst case analysis. This form of analysis has been adopted by administrators and upheld by the courts for good reason — it is the best practicable way to deal with environmental impacts which are of low probability but high or catastrophic impact. Some of the impacts discussed in EISs under NEPA are direct, immediate, and certain — industrial effluent will contaminate the water; a coal-fired plant's emissions will pollute the air; a mining lease will preclude other uses of the involved public lands; a supersonic bomber will create noise pollution. Other federal actions requiring EISs may involve less certain but more severe consequences — the dam or the housing development near the earthquake fault; the nuclear power plant near human settlements; the federally financed development in the 100-year floodplain; the toxics disposal site in the area subject to flooding; the liquified natural gas tanker designed to ply treacherous straits. All these proposals have in common a lower probability (or otherwise put, a higher improbability) of occurrence coupled with particularly severe consequences should the contingency occur.

This latter type of low probability/high severity environmental impact must also be addressed under NEPA. It is to address this sort of issue that the CEQ NEPA regulations, which were based on the experience of administrative agencies and the guidance of the courts, included the "worst case" rule.

But, if a threshold of reasonable foreseeability is placed in front of the need for a worst case analysis, as a practical matter, the rule will be gutted. Reasonable foreseeability, though a somewhat oblique term, does imply [13 ELR 10395] some element of probability. But, worst case is designed for the improbable (but potentially catastrophic) situation. If a catastrophic impact is probable (e.g., a 60 percent chance that a nuclear installation will melt down within 10 years), nobody in their right mind would dream of going forward. It is where the potential impact is catastrophic but improbable that the analytical tool of worst case is needed.

We do not site nuclear power plants in downtown Washington, D.C. or San Francisco, not because of what will happen but because of what could happen. The safety record of nuclear power plants has, after all, been a fine one in terms of actual health impacts. Nobody, as the nuclear industry is fond of saying, died at Three Mile Island. Nevertheless, we would all, I suspect, be leery about putting a nuclear power plant in the middle of a city. Why? Because the potential for catastrophic impact, however improbable, deters the reasonable person from taking a risk which can be avoided by remote siting. That is all worst case analysis is about — directing professional attention and study to improbable but unfortunately not inconceivable (and in some case not very improbable) environmental consequences of proposals for major federal action.

The Proposed Guidance Does Not Accurately Reflect the Mandate of the CEQ NEPA Regulations

The proposed guidance accurately quotes from the definition of effects in § 1508.8 of the CEQ NEPA regulations to say that such effects must be "reasonably foreseeable." But what the proposed guidance does not do is to recognize that § 1502.22 is a special case. Sections 1502.10-1502.17 describe what must be included in all EISs. Other sections are only sometimes appropriate (i.e., § 1502.19 (appendix), § 1502.22 (incomplete or unavailable information), § 1502.23 (cost-benefit analysis)). Worst case is only applicable in a narrow range of circumstances (described in § 1502.22(b)). And in that narrow range, the explicit requirement to study worst case when the information is "essential" but unavailable or too costly must be read to displace the more general requirements pertaining to impacts generally.

The Proposed Guidance Would Unwisely Reverse CEQ's Public Interpretation of the Worst Case Requirement

In 1981, CEQ compiled the "Forty Most Asked Questions Concerning CEQ's National Environmental Policy Act Regulations," providing guidance on agency implementation of the regulations. 46 Fed. Reg. 18026-38 (1981). With respect to worst case analysis the CEQ guidance provided:

NEPA requires that impact statements, at a minimum contain information to alert the public and Congress to all known possible environmental consequences of agency action. Thus, one of the federal government's most important obligations is to present to the fullest extent possible the spectrum of consequences that may result from agency decisions, and the details of their potential consequences for the human environment.

Id. (emphasis in original). CEQ called for "reasonable projections of the worst possible consequences of a proposed action," and specifically called for analysis of a "low probability/catastrophic impact event." The proposed guidance would unwisely reverse this consistent CEQ interpretation.

The Proposed Guidance Would be Illegal

The proposed guidance would be illegal because it creates a "reasonably foreseeable" threshold not required by NEPA case law. The worst case requirement, though not the nomenclature, existed before adoption of the CEQ NEPA regulations. CEQ built the worst case analysis on a combination of case law and an administrative need to devise a mechanism for the study and consideration of a certain kind of impact. See e.g., Scientists Institute for Public Information v. AEC, 481 F.2d 1079, 1092, 3 ELR 20525, 20532 (D.C. Cir. 1973); Alaska v. Andrus, 580 F.2d 465, 473 n.36, 8 ELR 20237, 20242 n.36 (D.C. Cir.), vacated in part, 439 U.S. 922 (1978).

More recently, the courts have had an opportunity to interpret the rule and have relied upon CEQ and its guidance. The leading case since the regulations is Sierra Club v. Sigler, 695 F.2d 957, 13 ELR 20210 (5th Cir. 1983). Sigler involved an EIS for a proposed deepwater port at Galveston, Texas. The pertinent question was whether a "worst case" analysis discussing the "catastrophic impact" of a total cargo loss by a supertanker in Galveston Bay was required. The court held that it was.

The court made clear that to require disclosure of the "worst case" is not to prohibit an action from proceeding, but rather to have the facts set forth, along with an estimate of the probability of their occurrence. The court went on to note that "CEQ's interpretation of its worst case regulation makes it quite clear that the Sierra Club's catastrophic worst case is precisely what the CEQ intended." Id. at 972, 13 ELR at 20216. The Court quoted CEQ explanatory material, declaring that "all known possible environmental consequences of agency action" are to be covered, including analysis of a "low probability/catastrophic impact event." Id. (emphasis in original).

In Sigler the Government asserted that a worst case analysis was not required for "remote consequences," an argument which the trial court erroneously accepted. Id. at 974, 13 ELR at 20217. The Fifth Circuit, in reversing, stated:

As to remoteness, the triggering provisions do not use it as a criterion. The remoteness problem is instead addressed by mandating the preparation of a worst case analysis and indicating to the decisionmaker "the probability or improbability of its occurrence." [Citations omitted.] Thus the fact that the possibility of a total cargo loss by a supertanker is remote does not obviate the requirement of a worst case analysis in the FEIS.

Id. (emphasis in original).

It is helpful to distinguish between two kinds of remote consequences and their relevance to the NEPA process. There are some kinds of environmental impacts which are of tangential concern. One might consider, for instance, a proposal which products noise on a remote and uninhabited isle — an environmental impact; yes, but who cares?Nobody is bothered. Courts quite properly exercise a "rule of reason" and defer to the agency's judgment not to bother with this sort of remote effect. Quite different from that sort of "remote" effect is the situation of the sort we are dealing with in worst case analysis — of an improbable (but not impossible) impact [13 ELR 10396] which, if it occurred, would be catastrophic. Here NEPA must be observed in all its rigor.

The court in Sigler held that the "catastrophic event" there being considered, a total cargo loss by a supertanker, "is undoubtedly a significant adverse impact." Id. at 973, 13 ELR at 20217. "No party can seriously question," continued the court, "the importance of the analysis … to this decision." Id. Under the "reasonably foreseeable" threshold set out in the proposed guidance, a worst case analysis would not be required because a total cargo loss has a low probability of occurring. See also North Slope Borough v. Andrus, 642 F.2d 589, 605, 10 ELR 20832, 20841 (D.C. Cir. 1980) (worst case analysis for massive oil spill was reasonable); Southern Oregon Citizens Against Toxic Sprays v. Watt, 13 ELR 20174, reconsid. den., 20176 (D. Or. 1982) (requiring worst case analysis for herbicide spraying in a subsequent annual environmental analysis of a program for which an earlier program EIS had been prepared); Village of False Pass v. Watt, 565 F. Supp. 1123, 1152-53, 13 ELR 20905, 20917-18 (D. Alaska 1983) (requiring worst case analysis of the effects of noise pollution on bowhead whales caused by seismic disturbances from oil and gas exploration).

The Proposed Guidance Would Undercut Administrative Practice

Agencies have, with the blessing of the courts, come to rely on low probability/catastrophic impact analysis in appropriate situation. For example, the Nuclear Regulatory Commission (NRC) and its predecessor (the Atomic Energy Commission) had long contended that a "Class 9" accident (low probability/severe consequence) was too improbable to occur. After the Class 9 accident occurred at Three Mile Island (fortunately without loss of life) and after issuance of the CEQ NEPA regulations, the NRC now requires consideration of such possible but improbable accidents. (NRC, Nuclear Power Plant Accident Consideration Under the National Environmental Policy Act of 1969, 45 Fed. Reg. 40101-04 (1980)). Current NRC regulations also require appropriate evacuation routes from the vicinity of nuclear power plants in anticipation of the possibility of a nuclear accident. See 10 C.F.R. § 50.47 and 10 C.F.R. pt. 50, app. E.

The Supreme Court has blessed this sort of analysis. In the Court's recent case involving Three Mile Island, Metropolitan Edison Co. v. People Against Nuclear Energy, 103 S. Ct. 1556, 13 ELR 20515 (1983), the Court declined to apply NEPA to the psychological fears generated by the "Risk" of a nuclear accident at Three Mile Island. In so holding the Court distinguished the improbable but possible accident situation:

We emphasize that in this case we are considering effects caused by the risk of an accident. The situation where an agency is asked to consider effects that will occur if a risk is realized, for example, if an accident occurs at TMI-1, is an entirely different case. The NRC considered, in the original EIS and in the most recent EIA for TMI-1, the possible effects of a number of accidents that might occur at TMI-1.

Id. at 20521 n.9 (emphasis added).

In brief, responsible agencies have begun to examine the consequences of low probability/high severity impacts through compliance with the worst case rule (though some remain recalcitrant). It would be a shame for CEQ, an agency charged with concern for the environment, to undercut these healthy developments.

Worst Case Analyses Do Not Cause Undue Burdens

The requirements imposed by § 1502.22 were designed to cause neither undue burden nor delay, but to enable decisionmaking to proceed, including decisions in those instances where low probability/high severity consequences were present.

There appear to be no great burdens imposed by this requirement. The section applies only to EISs.According to CEQ's most recent annual report, 1,033 EISs were filed in the last year (1981) for which figures are available. CEQ, ENVIRONMENTAL QUALITY — 1982 314. Since the figure includes drafts, finals, and supplements, fewer than 500 actions are the suject of EISs each year (which are then discussed in drafts and finals and perhaps supplements). Out of this universe of 500 actions, only a small proportion come within the purview of § 1502.22.

In the same year 114 NEPA lawsuits were filed. Id. at 234. Again, only a small proportion involve § 1502.22 and specifically worst case. Only a hundful (less than five) of published decisions have involved worst case analysis in the four years (1979-1983) since the regulation came into effect. There does not appear to be any legitimate burden crying for alleviation.

The Proposed Guidance Would Undercut the Consensus That Exists With Respect to the CEQ NEPA Regulations

A rare and indeed unique consensus exists among the concerned interests with respect to the CEQ NEPA regulations. See, e.g., Implementation of the National Environmental Policy Act by the Council on Environmental Quality: Oversight Hearings Before the Comm. on Environment and Public Works, 97th Cong., 2d Sess. 6-8, 61-83 (1982) (testimony of Nicholas Yost); Yost, The Governance of Environmental Affairs — toward Consensus, Aspen Institute (1982). Those regulations were greeted with praise by organizations as diverse as the United States Chamber of Commerce, the National Governors' Association, the Natural Resources Defense Council, the National Wildlife Federation, and the Federal Paperwork Commission. The process of establishing this remarkable consensus involved responsiveness to various interests' identification of important values. Some provisions were ardently supported by the business community but not actively opposed by the environmental community. The inclusion of the provisions deemed of high importance by each affected interest, which were not objectionable to other interests, gave each affected group reason to give their support to the regulations as a whole.

The requirement for worst case analysis was one of those provisions of deepest interest to those concerned with environmental protection. To gut this critical requirement would be to undermine seriously the consensus that exists with respect to the CEQ NEPA regulations taken as a whole.

Conclusion

I submit that the proposed guidance is both illegal and unwise. The public interest would best be served by its withdrawal.