Does Federal Law Preempt Further CEQA Review of the High-Speed Rail Project?

The California Attorney General’s Office has filed a letter brief with the Third District Court of Appeal arguing that a federal interstate commerce law preempts CEQA review by the Third District in a pending challenge to the High-Speed Rail project. If the state’s arguments are successful, the High-Speed Rail project could face fewer environmental approval hurdles in the future. In particular, environmental review for the project could proceed solely under the National Environmental Policy Act (NEPA) and potentially occur more quickly than it would have under CEQA.

After petitioners/appellants in Town of Atherton, et al. v. California High-Speed Rail Authority (Case No. C070877) appealed the trial court’s dismissal of their suit, the Third District ordered all parties to brief whether federal law preempts state environmental law with respect to the rail project. On August 9, 2013, the California Attorney General’s Office, representing the California High-Speed Rail Authority, argued in its brief to the court that the federal Interstate Commerce Commission Termination Act (ICCTA) preempts CEQA and thus, the Third Appellate District lacks jurisdiction to impose CEQA remedies in the action.

The federal preemption argument is based on a June 13, 2013, decision by the federal Surface Transportation Board (STB) that it “has jurisdiction” over California’s rail project. The STB explained that California’s High-Speed Rail falls within its congressionally granted jurisdiction because it is an intrastate (i.e., between two or more points within California) “transportation by rail carrier” that “is carried out ‘as part of the interstate rail network.’” (California High-Speed Rail Authority-Construction Exemption-in Merced, Madera and Fresno Counties, Cal., Docket No. FD 35724, available at$file/43070.pdf.) The STB found that High-Speed Rail connects to Amtrak’s interstate rail lines, and thus is itself part of the interstate rail network.

According to the California Attorney General, the ICCTA established the STB and vested it with “exclusive regulatory jurisdiction over railroads involved in interstate commerce.” While acknowledging that the ICCTA “retains for the states the police powers reserved by the [U.S.] Constitution,” the Attorney General argues that the ICCTA contains express preemption language that preempts “state environmental preclearance laws,” including CEQA and CEQA remedies. This argument is supported by cites to federal case law, STB’s own decisions, and two California appellate cases.

If the Attorney General’s preemption argument is successful, California courts would lack subject matter jurisdiction over CEQA challenges to the High-Speed Rail project. This would affect not only the petitioners/appellants in currently pending cases, but also parties that may wish to bring suits against the future approvals of additional segments of the project. In this scenario, the High-Speed Rail project’s environmental review would only be subject to NEPA requirements.

On June 13, 2013, the STB approved and adopted the Final Environmental Impact Report/ Environmental Impact Statement, finding it took “the requisite ‘hard look’ at the potential environmental impacts associated with the proposed Project as required by NEPA.” For High-Speed Rail opponents, the options for challenging this NEPA decision are somewhat less attractive (i.e., less likely to result in significant delay or additional mitigation) than bringing CEQA claims.