Key Takeaways

• While the Trump administration has taken action to eliminate environmental justice (EJ) programs at the federal level, state programs with EJ laws and policies remain in place and apply to regulated entities.
• These state EJ programs remain fully applicable, and as often occurs in the absence of federal actions in a given area, states may increase their EJ activities. Some states have already signaled interest in expanding their EJ activities.
• However, the regulated community should be aware of potential tensions between federal law and policy, and state programs. State programs could ultimately be subject to future scrutiny by the Trump administration as has occurred in other areas.
• As businesses continue to navigate this dynamic, EJ and other effective means of community engagement remain valuable opportunities to mitigate risks of challenges to project development and build meaningful relationships in the communities in which they operate. 

Background and Recent Actions on EJ By the Trump Administration

EJ, historically defined by the U.S. Environmental Protection Agency (EPA) as the “fair treatment and meaningful involvement of all people regardless of race, color, national origin, or income with respect to the development, implementation, and enforcement of environmental laws, regulations and policies,” experienced an unprecedented renaissance under the Biden administration. Bipartisan legislation such as the Inflation Reduction Act's (IRA) allocation of billions of dollars to advance environmental health in historically overburdened communities compounded this paradigm shift.

However, federal EJ policy—which has never been enshrined in any binding federal authority—is uniquely susceptible to shifting political winds. As demonstrated by the Trump administration’s slew of executive orders (EOs) issued almost immediately upon assuming office, the era of federal prioritization of EJ has been replaced by one in which the federal government has become actively antagonistic to its previous EJ initiatives—and, at times, antagonistic to the regulated community’s approach to EJ. The Trump administration has reversed many prior federal actions on EJ, including through the following actions:

• EO 14148, Initial Rescissions of Harmful Executive Orders and Actions, which revoked Biden-era EJ EOs expanding the federal government’s commitment to addressing EJ in the context of revoking prior diversity, equity, and inclusion (DEI) initiatives;
• EO 14173, Ending Illegal Discrimination and Restoring Merit-Based Opportunity, went a step further, withdrawing the 1994 EO 12898, the first federal action requiring agencies to systematically consider EJ as a part of their respective activities, and, until a few years ago, represented the only express federal EJ authority;
• EO 14151, Ending Radical and Wasteful Government DEI Programs and Preferencing, directed agencies to “terminate, to the maximum extent allowed by law,” all EJ offices and positions; and,
• EO 14154, Unleashing American Energy, instructed agencies to immediately pause disbursement of funds appropriated under the IRA or the Infrastructure Investment and Jobs Act.
• More recently, the administration released EO 14281, Restoring Equality of Opportunity and Meritocracy, which instructs DOJ to repeal or amend all disparate impact regulations derived from Title VI of the Civil Rights Act of 1964 that prohibits acts that have an unjustified disparate impact on the basis of race, color, or national origin, even without evidence of discriminatory intent. In the context of EJ, claims of “disparate impact” have been used to challenge federal actions such as permitting decisions and uses of federal funding that allegedly have an adverse and disproportionate impact based on race, color, or national origin.

Agencies have moved quickly to implement the EOs. For example, EPA has eliminated its Office of Environmental Justice and Civil Rights, placed 168 employees involved with EJ work on leave (then subsequently reinstated some of them), canceled hundreds of grants designed to fund EJ projects, and removed EJScreen—its hallmark EJ mapping and screening tool that has existed for almost a decade—from its website. In late January, the Department of Energy (DOE) directed the suspension of all initiatives requiring, using, or enforcing community benefits plans designed to direct the benefits from federal investments to workers and communities, including in binding contracts the previous DOE administration had entered into with grantees.

In February, the Department of Justice (DOJ) terminated its Office of Environmental Justice. In one of her first actions as U.S. Attorney General, Pam Bondi ordered each component of DOJ to confirm the termination of all EJ programs, offices, and jobs by March 15, and rescind all prior EJ policies, directives, and guidance within two days. In April, DOJ terminated its first EJ-focused settlement agreement with the Alabama Department of Public Health and Lowndes County under Title VI of the Civil Rights Act of 1964 addressing alleged inequities in access to basic sanitation services. The agreement required the state to, among other things, conduct a comprehensive assessment of appropriate septic and wastewater management systems and suspend the criminal enforcement of sanitation laws where violations were based on a failure to afford basic septic systems. At the same time, the fate of all DOJ and EPA disparate impact regulations under Title VI hang in the balance as the U.S. District Court for the Western District of Louisiana—after enjoining EPA and DOJ from these regulations in the state of Louisiana—considers whether or not to vacate the regulations in their entirety.

Implications for the Regulated Community

The reversal of EJ policies, even if somewhat anticipated, nonetheless puts the regulated community—particularly companies operating in states with standalone EJ laws on the books and companies that recently ramped up their EJ efforts in response to Biden-era policies—in a precarious position. States have continued implementing and enforcing their EJ laws and policies. We may see an increase in state EJ activity, NGO advocacy, and litigation in an attempt to fill the void created by the new administration. At the same time, the administration has warned state agencies not to use federal dollars to advance EJ programs. The administration has also set a precedent of threatening to pull—and actually withholding—federal funds from entities that do not comply with its anti-DEI policies—and could do the same with EJ. The administration could also target EJ laws in a similar fashion to its recently-filed challenges to laws in New York and Vermont relating to climate change.

This landscape affords little predictability, certainty, or clarity regarding how the regulated community should act when facing conflicts between state and federal directives on EJ. Ultimately, how the federal government engages with independent state EJ laws remains to be seen. Early signs, however, suggest that the federal government may not impede states from implementing their own independent EJ laws and policies—as long as federal funding is not involved. For example, EPA Region 2 recently upheld a Clean Air Act Title V major source permit issued by the New Jersey Department of Environmental Protection that contains EJ requirements stemming from New Jersey’s 2020-era landmark EJ law. At the same time, failure to comply with applicable state or local laws and regulations could result in immediate adverse consequences, such as an enforcement response or permit-denial—even as the federal government continues to dismantle EJ programs and policies.

Some situations may present novel questions for businesses operating consistent with state EJ programs. For instance, EO 14173 requires federal contractors to certify that they do not have DEI programs, and DOJ recently launched an enforcement initiative targeting recipients of federal funding that have DEI policies. Could abiding by state EJ mandates implicate this requirement? Or could federal funding, or some other link to federal law (such as a joint federal-state enforcement action) change the applicable legal analysis? The possibility that the federal government may take further steps with respect to state EJ programs may also raise concerns for those participating in such programs. 

Although companies should be aware of these issues, they should continue to stay engaged in community relations efforts to mitigate oppositional risks, smooth the way for project development, and cultivate meaningful relationships with communities. At its core, EJ is fundamentally about being a good neighbor—something that can only be good for business.