SUBJECT: ESTABLISHING, REVISING, AND USING CATEGORICAL EXCLUSIONS UNDER
THE NATIONAL ENVIRONMENTAL POLICY ACT

I. Introduction

The following guidance is provided to assist Federal agencies in
improving and modernizing their administration of categorical exclusions
under NEPA. The guidance recommends procedures and approaches for
establishing and revising categorical exclusions; involving the public;
documenting development, revision, and use of categorical exclusions;
and periodically reviewing categorical exclusions.

The CEQ regulations define categorical exclusion in 40 CFR § 1508.4:

> "Categorical exclusion" means 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. . . . Any procedures under this section shall provide for
> extraordinary circumstances in which a normally excluded action may
> have a significant environmental effect.

CEQ established the CEQ NEPA Task Force to review NEPA implementation
and identify opportunities to improve and modernize the NEPA process. To
promote consistent categorical exclusion development and use, the CEQ
NEPA Task Force recommended that CEQ issue clarifying guidance on
categorical exclusions.[^1] This guidance is based on existing CEQ
regulations and guidance, legal precedent, and agency NEPA experience.
In keeping with CEQ regulations at 40 CFR § 1507.1, the intent of this
guidance is to allow agencies flexibility in implementing the procedures
for categorical exclusions that are adapted to the requirements of other
applicable laws.

II\. The Purpose of Establishing New Categorical Exclusions[^2]

The purpose of a categorical exclusion is to eliminate the need for
unnecessary paperwork and effort under NEPA for categories of actions
that normally do not warrant preparation of an environmental impact
statement (EIS) or environmental assessment (EA).[^3] Developing
appropriate categorical exclusions promotes the cost-effective use of
agency NEPA related resources. Federal agency personnel should develop a
categorical exclusion when they identify a class of actions without
significant environmental impacts. A Federal agency should also consider
developing categorical exclusions to respond to changes in mission or
responsibilities as the agency gains experience with the new activities
and their environmental consequences.[^4]

Revision of an existing categorical exclusion can promote efficiency by
clarifying the actions that are covered by an existing categorical
exclusion. For example, a Federal agency may find that an existing
categorical exclusion is not being used because the category of actions
is too narrowly defined. In such cases, the agency should consider
expanding the category of actions. Conversely, if an agency finds that
an existing categorical exclusion includes actions that are regularly
found to require additional NEPA analysis, then the agency should revise
the categorical exclusion to limit the category of actions included.

III\. Substantiating a New Categorical Exclusion

A key issue confronting Federal agencies is how to evaluate whether a
proposed categorical exclusion is appropriate and how to support the
determination that it describes a category of actions that do not
individually or cumulatively have a significant effect on the human
environment.[^5] The information that supports establishing a
categorical exclusion should demonstrate how the agency determined that
the proposed categorical exclusion does not typically result in
significant environmental effects and set forth the methodology and any
criteria used to define the proposed category of actions.

A. The Elements of a Categorical Exclusion

The text of a proposed categorical exclusion should clearly define the
category of actions as well as any physical or environmental factors
that would constrain its use. An example of a physical constraint is a
limit on the extent of the action (e.g., miles). Examples of
environmental constraints are limits on where and under what conditions
the categorical exclusion may be used (e.g., particular seasons in
habitat areas). Federal agencies should also consider the opportunity to
develop categorical exclusions that are limited in their application to
regions or areas of the country where it can demonstrate that the
actions do not present significant impacts based on the similarity of
environmental settings.

When developing a categorical exclusion, the Federal agency must make
certain that the proposed category clearly describes all the actions
that should be included. Categorical exclusions should not be
established in a disaggregated or segmented format simply to circumvent
the evaluation of environmental effects required for NEPA compliance
through an EA or EIS.

A Federal agency's NEPA procedures for categorical exclusions must
provide for extraordinary circumstances.[^6] Extraordinary circumstances
function to identify the atypical situation or environmental setting
where an otherwise excluded action merits further analysis and
documentation in an EA or an EIS. For many agencies, their existing
extraordinary circumstances provisions (often presented as a list) will
suffice. However, an agency may develop extraordinary circumstances that
specifically relate to the new categorical exclusion and propose them in
conjunction with the categorical exclusion.

# B. Gathering Information to Substantiate a Categorical Exclusion

CEQ guidance generally addresses establishing categorical exclusions.

> Section 1507 of the CEQ regulations directs federal agencies when
> establishing implementing procedures to identify those actions which
> experience has indicated will not have a significant environmental
> effect and to categorically exclude them ....[^7]

Various sources of information relevant to the action and its
environmental effects may be used to substantiate a categorical
exclusion including but not limited to evaluation of implemented
actions, impact demonstration projects, information from professional
staff and expert opinion or scientific analyses, and others' experiences
(benchmarking).[^8]

Sources with substantial similarities to the proposed categorical
exclusion will prove to be the most useful. Substantiating information
should account for similarities and differences relative to the proposed
categorical exclusion in terms of the scope of actions, methods of
implementation, and environmental settings. The Federal agency should
maintain an administrative record that includes all sources of
information used and related findings. The agency should also summarize
that information and the related findings in the Federal Register
publication of the proposed categorical exclusion.

> 1\. Evaluating an Agency's Implemented Actions

Evaluation of implemented actions, as used in this guidance, refers to
monitoring and evaluating the environmental effects of the Federal
agency's completed or ongoing actions. The benefit of evaluating an
agency's own actions is that the implementation and operating procedures
are in place and well known. The evaluation should include data
collected before the proposed categorical exclusion is finalized.
Collaboratively monitoring and evaluating implemented actions with
non-federal entities can provide useful information for substantiating a
categorical exclusion.

For a category of actions that the agency analyzed in EAs that supported
Findings of No Significant Impact (FONSIs), evaluations can validate the
predicted environmental effects, and provide strong support for a
proposed categorical exclusion. Evaluation of implemented actions
analyzed in an EIS may also be used to substantiate a categorical
exclusion for activities. An EIS can be used when the action is minor,
subordinate to and not dependent upon other actions. An EIS can also be
used when it analyzes both a large management action and a smaller,
independent action.

Finally, Federal agencies with an Environmental Management System (EMS)
may be able to use data generated through their EMS.[^9] An EMS may
provide a record of environmental performance and help identify actions
that should be included in a proposed categorical exclusion or proposed
extraordinary circumstances.

###### 2. Impact Demonstration Projects

As used in this guidance, the term impact demonstration project
describes a project that includes the NEPA analysis of a proposed action
(for which the agency does not have extensive experience),
implementation of the action, and evaluation of the environmental
effects of the action. The NEPA documentation prepared for the
demonstration project should explain that one of the purposes of the
NEPA process is to generate analyses for substantiating a proposed
categorical exclusion.

In designing an impact demonstration project it is particularly
important that the action being evaluated accurately reflect the
category of actions described in the proposed categorical exclusion and
that the action is implemented under similar operational and
environmental conditions as in the proposed categorical exclusion.
Several projects may be useful when environmental conditions vary in
different regions where the categorical exclusion would be used.

######  3. Professional Staff and Expert Opinions, and Scientific Analyses

A Federal agency may use their professional staff and outside expert
opinions as a valid source of information to substantiate a categorical
exclusion. Those individuals should have special knowledge, training,
experience, or understanding relevant to implementation of the actions
described in the proposed categorical exclusion and the environmental
effects of the action. The agency record should include such
individuals' credentials (e.g., education, training, certifications,
years of related experience).

The use of scientific analyses need not be limited to peer-reviewed
findings and may also include professional opinions, reports, and
research findings. However, because the reliability of scientific
information varies according to its source and the rigor with which it
was developed, the Federal agency remains responsible for determining
whether the information in question reflects accepted knowledge or
findings and addresses the effects of the actions included in the
proposed categorical exclusion.

# 4. Benchmarking Public and Private Entities' Experiences

As used in this guidance, the term benchmarking means using information
and records from other private and public entities' experience with
similar actions. When evaluating whether it is appropriate to rely on
others' experience, it will be necessary to demonstrate that the
categorically excluded actions and their environmental effects are
comparable to the category of actions in the proposed categorical
exclusion. Benchmarking should consider the similarities and differences
in: (1) methods of implementing the actions; (2) characteristics of the
actions; (3) frequency of the actions; (4) applicable standard operating
procedures or implementing guidance; and (5) environmental settings in
which the actions take place. Although an agency cannot simply use
another agency's categorical exclusion for a proposed action, a Federal
agency may find it useful to consider another Federal agency's
experience and supporting information involving categorically excluded
actions.

# 

# C. Refining a Proposed New Categorical Exclusion

If a proposed categorical exclusion is found to have a potentially
significant effect, the Federal agency should either drop consideration
of the categorical exclusion or consider refining it. Examples include:
limiting or removing actions included in the proposed categorical
exclusion; adding text that places additional constraints on the use of
the categorical exclusion; or refining the applicable extraordinary
circumstances.

Federal agencies may also consider limiting the geographic applicability
of the categorical exclusion. For example, if the category of actions is
typically without significant effects in the northeastern United States
or in a particular set of watersheds, it may be appropriate to establish
a regional or spatially-based categorical exclusion.

Furthermore, when developing a new categorical exclusion, it may be
helpful or necessary to identify extraordinary circumstances
specifically tailored for that categorical exclusion. Such tailoring
would facilitate identifying atypical circumstances and further ensure
that the use of the categorical exclusion would typically not result in
individual or cumulative significant environmental effects.

# IV. Procedures for Establishing a New Categorical Exclusion

The process of establishing or revising an agency's NEPA procedures, as
distinguished from explanatory guidance, is found in 40 CFR §1507.3(a).

> Each agency shall consult with the Council while developing its
> procedures and before publishing them in the FEDERAL REGISTER for
> comment. Agencies with similar procedures should consult with each
> other and the Council to coordinate their procedures, especially for
> programs requesting similar information from applicants. The
> procedures shall be adopted only after an opportunity for public
> review and after review by the Council for conformity with the Act and
> these regulations \[40 CFR parts 1500 -- 1508\]. The Council shall
> complete its review within 30 days. Once in effect they shall be filed
> with the Council and made readily available to the public. Agencies
> are encouraged to publish explanatory guidance for these regulations
> and their own procedures. Agencies shall continue to review their
> policies and procedures and in consultation with the Council to revise
> them as necessary to ensure full compliance with the purposes and
> provisions of the Act.

Federal agencies are encouraged to involve CEQ early in the process to
take advantage of CEQ expertise and assist in coordinating with other
agencies to make the process as efficient as possible. Federal agencies
should consult with CEQ on both the proposed categorical exclusion and
the final categorical exclusion.[^10]

Any proposed categorical exclusion must be made available for public
review and comment. At a minimum, the CEQ regulations require Federal
agencies to publish the proposed categorical exclusion in the Federal
Register and provide a period during which the public may submit
comments on the proposal.[^11] Federal agencies are encouraged to
maintain a file of the comments and responses. To maximize the value of
input from interested parties and assist them in focusing their
comments, the agency should make information supporting the categorical
exclusion available to the public.

Following the public comment period, the Federal agency should consult
with CEQ and review the nature of any substantive comments received and
how they were addressed. For consultation to successfully conclude, CEQ
must provide a written statement that the final proposed categorical
exclusion was developed in conformity with NEPA and the CEQ regulations.
CEQ must complete its review within 30 days of receiving the final text
of the proposed categorical exclusion.

The final categorical exclusion must then be published in the Federal
Register. This publication can serve to satisfy the requirements that
the agency file the categorical exclusion with CEQ, and make it readily
available to the public.

The following recommended and required steps establish a categorical
exclusion as part of the agency NEPA procedures, regardless of the
format the agency uses for its NEPA procedures.[^12]

1.  Draft proposed categorical exclusion based on experience indicated
    in supporting information.

2.  Consult with CEQ on draft of proposed categorical exclusion.

3.  Consult other Federal agencies with similar procedures, jurisdiction
    by law, or special expertise regarding the category of activities
    and their effects.

4.  Publish notice of proposed categorical exclusion in the Federal
    Register for public review and comment.

5.  Consider public comments in developing final categorical exclusion.

6.  Consult with CEQ on final categorical exclusion to obtain
    determination of conformity with NEPA and the CEQ regulations.

7.  Publish final categorical exclusion in the Federal Register.

8.  File final categorical exclusion with CEQ.

9.  Make final categorical exclusion readily available to the public.

V. Public Involvement in Establishing a Categorical Exclusion

A NEPA process is not required for establishing or revising agency NEPA
procedures.[^13] However, engaging the public in the environmental
aspects of federal decisionmaking is a key aspect of NEPA and an
opportunity for public involvement beyond publication in the Federal
Register for review and comment should be considered.[^14] The Federal
Register notice requesting comment on the proposed categorical exclusion
should:

-   Describe the proposed categorical exclusion and provide the proposed
    text.

-   Summarize the agency rationale and history for its development and
    advise the public on how to access the agency's supporting
    information and, whenever practicable, include a link to a website
    containing the supporting information.[^15]

-   Define all applicable terms.

-   Summarize how the proposed categorical exclusion fits into the
    existing agency NEPA implementation process.

-   Explain how extraordinary circumstances, and possibly other factors
    such as connected actions and cumulative impacts, may limit the use
    of the categorical exclusion.

-   Explain available avenues for public comment and feedback on the
    proposed categorical exclusion.

When establishing a categorical exclusion the Federal agency should
tailor the type and length of the public involvement to the nature of
the proposed category of actions and its perceived environmental
effects. CEQ encourages Federal agencies to engage interested parties
such as public interest groups, Federal NEPA contacts at other agencies,
consultants, and Tribal, State, and local government agencies to share
relevant data, information and concerns. The methods noted in 40 CFR §
1506.6 and other public involvement techniques such as focus groups,
meetings, e-mail exchanges, conference calls, and web-based forums can
be used to stimulate public involvement.

#### 

#### VI. Using an Established Categorical Exclusion

The CEQ regulations do not address documentation or public involvement
for using a categorical exclusion. CEQ guidance states:

> (T)he Council believes that sufficient information will usually be
> available during the course of normal project development to determine
> the need for an EIS and further that the agency\'s administrative
> record will clearly document the basis for its decision. Accordingly,
> the Council strongly discourages procedures that would require the
> preparation of additional paperwork to document that an activity has
> been categorically excluded.[^16]

A. Documentation

Each Federal agency should decide if a categorical exclusion
determination warrants preparing additional paperwork and, if so, how
much documentation is appropriate. Documentation is an important
component of any adequate administrative record. The extent of the
documentation should be related to the type of action involved, the
potential for extraordinary circumstances, and compliance with other
laws, regulations, and policies.

A Federal agency may decide to create a concise record for an action
where there are reasonable questions regarding the existence of
extraordinary circumstances that may create the potential for the use of
the categorical exclusion to be questioned.  If a record is prepared, it
should cite the categorical exclusion used and show that the agency
considered: (1) how the action fits within the class of actions
described in the categorical exclusion, and (2) whether there are any
extraordinary circumstances that would preclude the project or proposed
action from qualifying as a categorically excluded action.

Some courts have required documentation to demonstrate that a Federal
agency has considered extraordinary circumstances in cases where the
absence of extraordinary circumstances is not obvious.[^17] Documenting
the use of a categorical exclusion facilitates judicial review under the
Administrative Procedure Act, which requires review to be based upon a
pre-existing record.[^18]

Using a categorical exclusion does not absolve Federal agencies from
complying with the requirements of other laws, regulations, and
policies. Documentation created for individual actions or projects may
be necessary to comply with such requirements. When that is the case,
all resource analyses and the results of any consultations or
coordination (e.g., under Endangered Species Act or National Historic
Preservation Act), should be included or incorporated by reference in
the administrative record for the action.

B. Public Involvement

Most Federal agencies do not routinely notify the public when they use a
categorical exclusion to meet their NEPA responsibilities. In situations
where there is a high public interest in an action that will be
categorically excluded, CEQ encourages Federal agencies to involve the
public in some manner (e.g., notification, scoping), particularly when
the public can assist the agency in determining whether a proposal
involves extraordinary circumstances or cumulative impacts.

#### VII. Periodic Review of Categorical Exclusions 

The CEQ regulations direct Federal agencies to periodically review their
policies and procedures; however, they do not describe how such a review
should be conducted.[^19] CEQ encourages Federal agencies to develop
procedures for identifying and revising categorical exclusions that no
longer effectively reflect current environmental circumstances or where
agency procedures, programs, or missions have changed.

A Federal agency can keep a record of its experience by tracking
information provided by agency field offices.[^20] In such cases, a
Federal agency review of a categorical exclusion could consist of
e-mails, memos, and letters from field offices that include observations
of the effects of implemented actions, and public input on actions and
their environmental effects.

Another approach to reviewing existing categorical exclusions is through
a program review. Program reviews can occur at various levels (e.g.,
field office, division office, headquarters office) and on various
scales (e.g., geographic location, project type, or as a result of an
interagency agreement). While a Federal agency may choose to initiate a
program review that specifically focuses on categorical exclusions, it
is possible that program reviews with a different focus may also be able
to provide documentation of experience relevant to a categorical
exclusion.

There are many good reasons why Federal agencies should perform
categorical exclusion reviews. They can serve as the impetus for
expanding the categorical exclusion to include actions not previously
categorically excluded. They may help identify additional extraordinary
circumstances. Categorical exclusion reviews may also help a Federal
agency consider the appropriate documentation when using certain
categorical exclusions.

Finally, the rationale and supporting information for establishing or
documenting experience with using a categorical exclusions can be lost
when there are inadequate systems and procedures for recording,
retrieving, and preserving agency documents and administrative records.
Therefore, Federal agencies may benefit from a review of current
practices used for maintaining and preserving such records. Measures to
ensure future availability may include, but not be limited to, redundant
storage systems (e.g., multiple drives, paper copies), and improvements
in the agency electronic and hard copy filing and retrieval
systems.[^21]

[^1]: Council on Environmental Quality, "The NEPA Task Force Report to
    the Council on Environmental Quality -- Modernizing NEPA
    Implementation," (Sept. 2003), available at
    http://www.ceq.eh.doe.gov/ntf.

[^2]: This guidance applies to establishing new or revised categorical
    exclusions, and uses the term "new" to include revisions of
    categorical exclusions that are more than administrative (e.g.,
    revise to update outdated office or agency title) or editorial
    (e.g., correct spelling or typographical errors).

[^3]: 40 C.F.R. §§ 1500.4(p) and 1500.5(k).

[^4]: When legislative or administrative restructuring creates a new
    agency or realigns an existing agency, the agency may need to
    develop new NEPA procedures that include categorical exclusions.

[^5]: 40 C.F.R. §§ 1508.7, 1508.8, and 1508.27.

[^6]: 40 C.F.R. § 1508.4.

[^7]: Council on Environmental Quality, "Guidance Regarding NEPA
    Regulations," 48 FR 34263 (July 28, 1983), available at
    http://www.nepa.gov/nepa/regs/1983/1983guid.htm.

[^8]: Agencies should be mindful of their obligations under the
    Information Quality Act to ensure the quality, objectivity, utility,
    and integrity of the information they use or disseminate as the
    basis of an agency decision to establish a new categorical
    exclusion. Section 515, Public Law 106-554; Office of Management and
    Budget Information Quality Guidelines, 67 Fed. Reg. 8452 (Feb. 22,
    2002), available at
    http://[www.whitehouse.gov/omb/inforeg/infopoltech.html](http://www.whitehouse.gov/omb/inforeg/infopoltech.html).
    Additional laws and regulations establish obligations that apply or
    may apply to the processes of establishing and applying categorical
    exclusions, such as the Federal Records Act; these are beyond the
    scope of this guidance.

[^9]: An EMS provides a systematic framework for a Federal agency to
    monitor and continually improve its environmental performance
    through audits, evaluation of legal and other requirements, and
    management reviews.

[^10]: 40 C.F.R. § 1507.3.

[^11]: 40 C.F.R. §§ 1507.3 and 1506.6(b)(2).

[^12]: NEPA and the CEQ regulations do not require agency NEPA
    implementing procedures to be promulgated as regulations through
    formal rulemaking; therefore the rulemaking process is not described
    herein. Agencies that use rulemaking should ensure they comply with
    all appropriate requirements.

[^13]: *Heartwood, Inc. v. U.S. Forest Service*, 73 F. Supp. 2d 962,
    972-73 (S.D. Ill. 1999), *aff'd*, 230 F.3d 947, 954-56 (7th Cir.
    2000).

[^14]: "Agencies shall: (a) Make diligent efforts to involve the public
    in preparing and implementing their NEPA procedures." 40 C.F.R. §
    1506.6.

[^15]: Ready access to all supporting information may minimize the need
    for members of the public to depend on Freedom of Information Act
    requests and enhance the NEPA goals of outreach and disclosure.

[^16]: Council on Environmental Quality, "Guidance Regarding NEPA
    Regulations,"48 FR 34263 (July 28, 1983), available at
    http://www.nepa.gov/nepa/regs/1983/1983guid.htm.

[^17]: Council on Environmental Quality, "The NEPA Task Force Report to
    the Council on Environmental Quality -- Modernizing NEPA
    Implementation," p. 58, (Sept. 2003), available at
    http://www.ceq.eh.doe.gov/ntf.

[^18]: The agency determination that an action is categorically excluded
    may be challenged under the Administrative Procedures Act. 5 U.S.C.
    702 et seq.

[^19]: 40 C.F.R. § 1506.6.

[^20]: Council on Environmental Quality, "The NEPA Task Force Report to
    the Council on Environmental Quality -- Modernizing NEPA
    Implementation," p. 63, (Sept. 2003), available at
    http://www.ceq.eh.doe.gov/ntf.

[^21]: Agencies should be mindful of their obligations under the Federal
    Records Act for maintaining and preserving agency records. 44 U.S.C.
    chapters 21, 29, 31, and 33.