On Monday, in Lind-Barnett v. Tender Care Veterinary Center Inc., 2025 CO 62, the Colorado Supreme Court announced a two-step test for determining whether challenged speech or conduct is made “in connection with a public issue or an issue of public interest” under Colorado’s anti-SLAPP statute. Courts must first assess whether the activity could reasonably be understood to relate to a public issue; then they must determine whether the activity contributed to public discussion or debate about that issue. The speaker’s motive plays no role in either inquiry.
The dispute arose after two community members—one identifying herself as a long-time breeder, trainer, sitter, and caregiver—posted a series of negative, widely viewed Facebook reviews criticizing a veterinary clinic’s quality of care and business practices, including alleged misdiagnoses and retaliatory conduct. The posts, shared on multiple local community pages, generated dozens of reactions and over 140 comments, which included accounts of other people’s experiences and statements that the information “may save lives.” When the posters refused to remove their content, the clinic sued for defamation.
The defendants moved to dismiss under Colorado’s anti-SLAPP statute, invoking the catchall provision that protects conduct or communication in furtherance of free speech or petition “in connection with a public issue or an issue of public interest.” § 13-20-1101(2)(a)(IV), C.R.S. (2025). The district court and the court of appeals denied the motion, concluding the posts were primarily private grievances that did not contribute to broader public discourse.
The Supreme Court reversed, holding the division applied the wrong legal standard, and set forth the two-step analysis courts must apply when determining whether challenged speech is made “in connection with a public issue or an issue of public interest.”
First, courts must ask whether an objective observer “could reasonably understand that the speech or conduct, considered in light of its content and context, is made in connection with a public issue or issue of public interest, even if it also implicates a private dispute.” While declining to define the full scope of “public issue” or “public interest,” the Court identified three nonexhaustive categories that often qualify: (1) statements that concern a person or entity in the public eye; (2) conduct that could directly affect a large number of people beyond the direct participants; and (3) topics of widespread, public interest.
Second, courts must examine the relationship between the speech and the identified public issue to determine “whether the challenged activity contributed to public discussion or debate regarding that issue.” In this step, courts should consider factors such as audience, speaker, location, purpose, and timing.
Crucially, the Court emphasized that a speaker’s motive is not relevant to either step of the anti-SLAPP analysis. The Court criticized the division’s reliance on motive—specifically, the defendants’ supposed desire “to exact some revenge”—in concluding the posts did not contribute to a broader public discussion about pet health care. At the same time, the Court recognized that while motive cannot be used to constrict the anti-SLAPP statute’s threshold protection, it may become relevant at a later stage—after the defendant establishes that the conduct is protected and the burden shifts to the plaintiff to show a likelihood of success on the claim, such as in defamation claims requiring proof of actual malice.
Applying these principles, the Court agreed with the division that consumer information about veterinary services implicates a public issue given, the societal interest in animal welfare. It held that the division erred by discounting the anti-SLAPP protections based on the defendants’ perceived retaliatory intent and by treating the speakers’ private grievances as dispositive of the public-interest inquiry. The Court held the broader context—the speaker’s personal experiences and use of community forums, the sizeable local audience, the high level of engagement, and the posts’ focus on the quality and practices of a licensed veterinary facility—supports the conclusion that the posts reasonably implicated and contributed to public discussion on matters of public interest.
The Supreme Court reversed the division’s judgment and remanded the case for the trial court to apply the clarified two-step test.
Recent years have seen an explosion of interest in “deep” geothermal development – projects targeting energy extracted from heat sources hundreds of meters below the surface and available 24/7 as a baseload power source. As geothermal innovators seek to prove viability of their technologies and heat resources, driving down the per megawatt cost to be comparable to existing energy sources, legislatures in North Dakota and New Mexico have stepped in this year to encourage the use of existing infrastructure and know-how from the oil and gas sector for geothermal energy development.
This past March, New Mexico enacted House Bill 361, known as the “Well Repurposing Act”, which permits the New Mexico Energy, Minerals, and Natural Resources Department to convert oil and gas wells for geothermal energy and carbon storage purposes and authorizes the Department to establish financial assistance requirements for operators undertaking such conversions.[1] The bill’s sponsors specifically targeted New Mexico’s nearly 2,000 orphaned wells (unplugged oil and gas wells which have no responsible owner or operator) – identifying the potential for geothermal energy producers to leverage existing, drilled wells, while mitigating the public’s exposure to environmental risks and plugging liabilities such orphaned wells pose.[2]
Meanwhile, North Dakota passed Senate Bill 2360 in April 2025, pursuant to which the legislative management shall consider a feasibility study to evaluate the state’s potential for geothermal energy production, including the potential application of geothermal energy to nonproductive oil and gas wells.[3] Prairie Public Broadcasting later reported that the University of North Dakota’s Energy and Environmental Research Center has been engaged to study the possibility of generating up to 600 megawatts of power from geothermal energy coupled with oil production or CO2 storage.[4]
Proponents of co-locating geothermal and hydrocarbon production see potential synergies in leveraging the deep expertise in subsurface drilling developed for oil and gas industries to better access and produce from deeper – and hotter – energy sources. All while reducing drilling costs to make geothermal power economically competitive compared to both traditional and renewable energy sources. Meanwhile, legislatures are hoping these solutions can alleviate their states’ concerns regarding orphaned well liabilities while pushing the energy transition forward.
In July 2025, President Trump issued an executive order setting forth a presidential priority “to facilitate the rapid and efficient buildout” of data centers and associated infrastructure, including power generation sources and associated transmission lines. To further this goal, the order directs the utilization of “federally owned land and resources for the expeditious and orderly development of data centers.” Additionally, the order calls for the identification of Brownfield and Superfund sites for data center development.
Federal agencies’ implementation of these directives to date is mixed. The Department of Energy (DOE) and U.S. Air Force are already accepting proposals for projects at certain sites within their jurisdiction. Despite its vast land holdings, however, the Department of the Interior (DOI) has not yet identified any sites on public lands for data center development. Agencies’ progress is detailed below, with an analysis of the potential impacts of delays.
Overview of the Executive Order.
The executive order applies to “data center projects” that require more than 100 megawatts of new load dedicated to artificial intelligence (AI) and certain “components” of these projects—namely, the materials, products, and infrastructure necessary to build data center projects, including energy infrastructure, transmission, and natural gas, coal, nuclear, and geothermal power sources. To be considered a “qualifying project” under the order, a data center project or its components must involve commitments of at least $500 million in capital expenditures, incrementally add more than 100 megawatts of electric load, protect national security, or otherwise be designated a qualifying project by one of several federal agencies.
Relevant to this update, the order calls for the Department of Defense (now known as the Department of War) (DoD), DOE, and DOI to identify sites for projects on lands within their jurisdiction. Additionally, the order directs the Environmental Protection Agency (EPA) to identify Brownfield sites and Superfund sites suitable for the development of qualifying data center projects.
Finally, the order sets forth numerous paths to streamline federal agencies’ permitting of data center projects.
Although Federal Lands Are Targeted for Data Center Projects, No Sites Have Been Identified on Public Lands.
DOE and DoD are implementing the order’s directive to identify sites for data center projects, but DOI has not yet publicly taken any steps to implement the order to promote the development of data center projects on federal public lands.
DOE Lands. The day after the President issued the order, DOE announced it had selected four sites—the Idaho National Laboratory, Oak Ridge Reservation in Tennessee, Paducah Gaseous Diffusion Plant in Kentucky, and the Savannah River Site in South Carolina—for data center development and energy generation projects. Then, in the fall of 2025, offices within DOE issued requests for application or proposal for projects at three of these sites; the National Nuclear Security Administration issued a request for offer for a project at the Paducah Gaseous Diffusion Plant. These application periods are either open or have recently closed. DOE has not identified a timeframe as to when it will announce which projects it will select.
DoD Lands. In October 2025, the U.S. Air Force issued a solicitation for proposals to develop “underutilized” lands at Arnold Air Force Base in Tennessee, Edwards Air Force Base in California, Joint Base McGuire-Dix-Lakehurst in New Jersey, Davis-Monthan Air Force Base in Arizona, and Robins Air Force Base in Georgia. Offers were due on November 14, 2025. The Air Force has not indicated when it will make decisions on proposals.
DOI Lands. DOI has not identified any sites for data center projects or sought public input on potential sites on federal public lands. Federal public lands include the vast expanse of lands the Bureau of Land Management (BLM) manages in western states for multiple uses, including energy development.
DOI’s inaction is notable for several reasons. First, the agency is the nation’s largest landholder; DOI manages more than 530 million acres of onshore surface lands and, of these, BLM manages approximately 245 million acres. Second, presidential administrations historically have used public lands to advance national objectives; for example, President Biden relied on public lands to increase large-scale renewable energy production. Finally, because many BLM lands can also be used for energy production, data centers can be co-located with energy sources.
And, timing compounds DOI’s inaction to date. BLM may be unable to move as nimbly as other federal agencies to authorize data center projects. BLM manages its lands in accordance with resource management plans, which are often developed through a multi-year public process. To accommodate data center development, BLM may need to amend or revise governing plans. Thus, data center development on BLM lands may require more process, and thus more time, than lands managed by other federal agencies.
Action on Brownfield Sites and Superfund Sites Is Forthcoming.
EPA has not yet identified Brownfield and Superfund sites for data center projects covered by the order. In November 2025, Inside EPA reported that EPA is developing criteria to identify suitable data center sites.
The order also calls for EPA, within 180 days of the order (i.e., by January 19, 2026), to develop guidance to expedite environmental reviews for qualified reuse of Brownfield and Superfund sites and to assist state governments and private parties to expeditiously return these sites to productive use. Presumably, this guidance will follow in a timely manner.
Conclusion
Much work remains before federal agencies can authorize the construction of data center projects on federal lands. 2026 will be a pivotal year for federal agencies to secure agreements for these projects so that they can be timely constructed.
Colorado’s Producer Responsibility Program for Statewide Recycling Act, HB22-1355 (the “Act”), establishes a mandatory extended producer responsibility (“EPR”) framework for packaging materials and paper products.[1] This framework shifts the cost of recycling packaging and paper products from local governments and consumers to the producers that introduce these materials into the marketplace by requiring the producers to fund a statewide recycling system to recycle those materials.
Program Background
The Act mandates the designation of an independent non-profit organization, called a Producer Responsibility Organization (“PRO”), to coordinate, fund, and manage this statewide recycling system.[2] Pursuant to this mandate, in May 2023, the Colorado Department of Public Health and Environment (“CDPHE”) designated Circular Action Alliance (“CAA”)—a national nonprofit PRO formed by companies across the consumer goods, food, beverage, and retail sectors—as Colorado’s implementing organization.[3]
CAA submitted its proposed plan to the state in February 2025 and a revised plan in June 2025 following feedback from the Producer Responsibility Advisory Board.[4] CDPHE is expected to approve the final plan by late 2025.
Key dates for producers under the Act include:
April 22, 2025: Registration portal launch
July 1, 2025: Producer registration deadline
July 31, 2025: Initial 2024 supply report due
January 1, 2026: Producers begin paying their dues
May 31, 2026–2030: Producers must report prior year’s supply[5]
Covered Materials
The Act applies to two principal categories of “covered materials”:
Packaging materials: Any material, regardless of recyclability, that is intended for single- or short-term use and used to contain, protect, handle, or deliver products to a consumer, including materials used for e-commerce transactions.[6]
Paper products: Items such as flyers, brochures, booklets, catalogs, telephone directories, newspapers, and magazines.[7]
Exemptions include:
Packaging (i) used for products that are sold or distributed out of state, (ii) used only in business-to-business transactions, (iii) not sold to covered entities, or (iv) used solely in transportation or distribution to non-consumers.[8]
Packaging intended for long-term (five-year or greater) protection or storage;[9]
Packaging that can become unsafe or unsanitary;[10]
Printed paper used for financial statements, billing statements, or medical/vital documents required by law;[11]
Bound books and print publications primarily comprising news or current-event content.[12]
Packaging used solely in industrial or manufacturing processes;[13]
Packaging for products regulated under certain federal health and safety legislation (e.g., the Federal Food, Drug, and Cosmetic Act, Virus-Serum-Toxin Act, and Federal Insecticide, Fungicide, and Rodenticide Act);[14]
Packaging used to contain refurbished portable electronic devices;[15]
Determining Producer Status
The Act’s definition of a “Producer” is broadly worded to encompass those who use, manufacture, first import, first distribute, or print covered materials.[16] Producers must join, pay membership fees, and provide information to the PRO.[17] Except in the case of internet transactions, where there are two equally obligated producers, producers are subject to the EPR System based on the order of who is first obligated.[18] The implementing regulations establish the following hierarchy for producers of packaging materials:
Brand Owner: The entity whose name or trademark appears on the product.
Licensee: If packaging is produced under a licensed trademark, the licensee directing packaging decisions.
Manufacturer: If no identifiable brand or licensee applies, the manufacturer of the packaged product.
Importer/Distributor: If none of the above are located in the United States, the importer or first distributor into Colorado.[19]
For paper products, the publisher is the producer of magazines, newspapers, catalogs, and similar publications.[20]
Producer Exemptions
There are limited producer exemptions under the Act:
Businesses with less than $5 million in annual gross revenue;
Businesses using under one ton of covered materials in the previous calendar year;
State or local governments and nonprofit organizations;
Agricultural employers with under $5 million in in-state revenue; and
Certain local food establishments and construction contractors.[21]
Entities that do not qualify for an exemption must register with CAA, sign the Producer Participant Agreement and state addendum, and comply with annual reporting and fee requirements.[22]
Compliance and Next Steps
To determine applicability under the Act, companies should conduct the following assessment, which is highly fact / company specific:
Identify Covered Materials: Review all packaging and printed materials associated with products sold or distributed in Colorado to determine whether they fall within the Act’s definitions or qualify for an exemption.
Determine Producer Responsibility: Assess your company’s role in the producer hierarchy to identify whether you are the brand owner, licensee, manufacturer, or importer responsible for reporting and fees.
Assuming you’ve determined the Act applies to your operations, the next steps are as follows:
Register with the PRO: Registration with Circular Action Alliance is mandatory for obligated producers. Registration can be completed at https://circularaction.org/registration.
Prepare for Reporting: Producers should compile data on packaging and paper quantities and types in advance of the supply-reporting deadline each year.
Monitor Regulatory Updates: CDPHE and CAA will continue to issue program guidance, fee schedules, and reporting tools ahead of implementation.
Key Takeaway
Colorado’s Producer Responsibility Program represents a significant policy shift toward producer-funded recycling. With many compliance deadlines having already passed, if they haven’t done so already, companies should evaluate their packaging portfolios, confirm exemption status, and initiate registration as soon as possible to ensure compliance.
[1] HB22-1355, as codified at Colo. Rev. Stat. §§ 25-17-701 to 716.
2026 Renewable Energy Outlook: The renewable energy industry has faced significant challenges in 2025, particularly with the passage of the One Big Beautiful Bill Act (OBBBA), which rolled back key tax credits and imposed new restrictions. And although wind and solar investments have fallen in 2025, renewables still dominated U.S. capacity growth, accounting for 93% of additions (30.2 GW) through September 2025, with solar and storage making up 83%. Last month, Deloitte released its 2026 Renewable Energy Industry Outlook, which outlines five key trends that could shape the industry in 2026. The outlook is a mixed bag. 2026 could be a good year for renewables, particularly for developers that can move quickly to take advantage of safe-harbor deadlines and build resilient and innovative operations, but any optimism is tempered by policy and supply chain risks.
Potential New FERC Regulations on Interconnection of AI Data Centers: The Department of Energy (DOE) has directed FERC to initiate a rulemaking to “rapidly accelerate the interconnection of large loads,” including AI data centers. DOE’s letter and attached Advanced Notice of Proposed Rulemaking (ANOPR), dated October 23, 2025, were issued pursuant to Section 403 of the Department of Energy Organization Act. If implemented as directed by DOE, the new rule would expand FERC’s jurisdiction over interstate transmission to provide for expedited grid access for data centers and other advanced manufacturing facilities. FERC received comments on the ANOPR through November 14, 2025, and is accepting reply comments through November 28, 2025. DOE has directed FERC to issue a final rule by April 30, 2026.
Litigation Update—Trump Attacks on Wind Industry: On his first day in office, President Trump issued a memorandum titled “Temporary Withdrawal of All Areas on the Outer Continental Shelf from Offshore Wind Leasing and Review of the Federal Government’s Leasing and Permitting Practices for Wind Projects.” The memo directs federal agencies to temporarily cease issuing new or renewed approvals, permits, or leases for onshore or offshore wind projects, pending a comprehensive review of federal wind-leasing and permitting practices, and directs the Secretary of Interior to review existing approvals, permits, and leases to identify legal bases for revocation. The memo and the administration’s subsequent actions have spurred a litany of lawsuits. In May 2025, the District of Columbia and 17 states filed suit challenging the administration’s authority to issue the memo (New York et al v. Trump, No. 1:25-cv-11221 (D. Mass.)); hearings were held this week in that suit. Litigation also has ensued over several stop-work orders issued pursuant to the memo, including those related to the high-profile Revolution Wind project—a 704 MW project that would be the first multi-state offshore wind farm in the U.S. In August 2025, the Department of Interior ordered Revolution Wind to stop work on construction (which was 80% complete) citing vague “national security concerns,” and both the developer and the States of Rhode Island and Connecticut filed suit (Revolution Wind, LLC v. Doug Burgum et al., No. 1:25-cv-02999 (D.D.C.); Rhode Island & Connecticut v. U.S. DOI, No. 1:25-cv-00439 (D.R.I.)). In September 2025, the D.C. District Court in Revolution Windissued a preliminary injunction that temporarily blocked the stop-work order, allowing construction to resume for now. These lawsuits, among several others, are ongoing.
EPA Seeks to Dismantle “Solar for All,” Litigation Ensues: On August 7, 2025, the U.S. Environmental Protection Agency (EPA) terminated the $7 billion Solar for All program, a Biden-era fund established under the 2022 Inflation Reduction Act designed to help low-income households, multi-family buildings, community solar, and underserved communities deploy solar energy. Announced on X (formerly Twitter) by EPA Administrator Lee Zeldin, the agency cited a lack of statutory authority to administer the program in light of the OBBBA. In October 2025, four separate lawsuits were filed challenging the termination of Solar for All. One of those suits—State of Arizona v. EPA—was filed by 22 states (including Colorado), the District of Columbia, and other stakeholders, and asserts violations of the Administrative Procedure Act and the Constitution, among other claims. A detailed summary of congressional and administrative developments surrounding Solar for All and the litigation that has ensued can be found on the Columbia Law School Sabin Center’s Climate Law Blog.
SEC ISSUES NEW GUIDANCE FOR REGISTERED CLOSED-END FUNDS INVESTING IN PRIVATE FUNDS
In August 2025, the Division of Investment Management (the “Division”) of the U.S. Securities and Exchange Commission (the “SEC” or the “Commission”) published Accounting and Disclosure Information 2025-16 (the “ADI”) providing updated guidance for registered closed-end funds that invest in private funds (“CE‑FOPFs”). The staff guidance in the ADI formalizes statements made by senior members of the SEC staff earlier this year that had reversed prior SEC staff guidance.
As noted in our Second Quarter 2025 Update, this new guidance is part of a shift from informal staff positions taken before May, which were implemented as part of the Division’s comment process. Previously, SEC staff took the position that a CE-FOPF must either: (1) limit such investments to no more than 15% of its assets or (2)(a) restrict sales of its own shares to investors that satisfy the accredited investor standard and (b) impose a minimum initial investment requirement of $25,000. Underlying private funds for these purposes are generally defined as investment companies but for the exclusions specified in sections 3(c)(1) or 3(c)(7) of the Investment Company Act of 1940, as amended (the “1940 Act”).
The SEC’s new ADI confirms CE-FOPFs can now invest in private funds without caps on investor eligibility, minimum investments, or exposure limits. The ADI explains that existing regulatory protections under federal securities laws provide adequate protection of investors in CE-FOPFs that indirectly invest in private funds.
The ADI guidance focuses on two key areas: registration statement disclosure and filing requirements. It also encourages registrants to consult with Division staff for clarity on these matters.
With respect to disclosures, the ADI highlights the following areas that the SEC staff will continue to focus on:
Plain English and Material Information: Registration statements must be clear, concise, and comply with the “plain English” rule.
Costs, Strategies, and Risks: CE‑FOPFs should provide full disclosure of its costs, strategies, and risks, as well as the investment process-related due diligence practices conducted by the adviser when evaluating private fund investment opportunities (including investment, operational, legal, and, as applicable, tax considerations). The liquidity terms of the CE-FOPF should also be disclosed clearly and prominently.
Fee Structures and Performance Impact: CE-FOPFs should describe the various fee structures imposed by the underlying private funds, including any performance-related compensation, as well as how those fees could affect the underlying private funds’ returns and the CE-FOPF’s performance. A CE-FOPF should also disclose how multiple layers of direct and indirect costs will impact the returns realized by an investor in the CE-FOPF, including the possibility that certain of the underlying private funds may receive performance fees, while other underlying private funds, or the overall performance of the CE-FOPF itself, is negative.
Underlying Private Fund Strategies: CE-FOPFs should consider disclosures about the types of underlying private funds in which it proposes to invest and the associated risks and considerations, including (to the extent material) the private funds’ investment strategies, risks associated with more volatile or speculative investments, conflicts of interest, and the liquidity of the private funds’ underlying investments.
Regulatory Differences: CE-FOPFs should clarify that the underlying private funds in which they invest are not subject to protections under the 1940 Act (e.g., leverage and transactions with affiliates), which may impact the CE-FOPF’s strategies, risks, and costs. The CE‑FOPF should also disclose that shareholders may have limited information about the underlying private funds in which the CE-FOPF is investing, including with respect to the underlying private funds’ holdings, liquidity, and valuation.
Material Risks: Where material, a CE-FOPF should consider disclosing the risks and impacts related to legal jurisdictions of the underlying private funds, liquidity terms (such as mandatory minimum holding periods, limitations or suspensions of redemptions, and the possibility of “payment in kind” distributions in response to a redemption request), and tax considerations when investing in private funds that produce non-qualifying income and that could impact the CE-FOPF’s pass-through status as a “regulated investment company” as defined under Subchapter M of the Internal Revenue Code.
With respect to filing requirements, the ADI details the appropriate filing process for existing CE-FOPFs seeking to adjust investor limits or asset exposure thresholds.
The ADI states that CE-FOPFs currently operating, which have invested or plan to invest more than 15% of their assets in private funds and have removed or intend to remove limitations on accredited investors and/or investment minimums, are required to file either (i) amendments to their registration statements in accordance with Rule 486(a) or Rule 486(b) of the 1933 Act, or (ii) updates to their prospectus supplements under Rule 424 of the 1933 Act, as applicable. CE-FOPFs should evaluate whether these cumulative changes are considered material, as this would necessitate a review by Division staff of a post-effective amendment to the CE-FOPF’s registration statement under Rule 486(a).
Registrants that currently limit private fund exposure to 15% of assets and never imposed accredited investor and/or investment minimum shareholder limitations on their registration statements and now seek to remove the 15% limitation should file a post‑effective amendment filing pursuant to Rule 486(a), subject to Division staff review.
NYSE PROPOSES TO REMOVE ANNUAL SHAREHOLDER MEETING REQUIREMENTS FOR CLOSED-END FUNDS
In June 2025, the New York Stock Exchange LLC (“NYSE”) proposed amendments to Section 302.00 (“Section 302.00”) of the NYSE Listed Company Manual, which would exempt certain 1940 Act registered closed-end funds (“CEFs”) from the requirement to hold annual shareholder meetings (the “NYSE Proposal”).
Under Section 302.00, companies listing common stock or voting preferred stock and their equivalents are required to hold annual shareholder meetings. Section 302.00 includes a list of the types of companies to which Section 302.00 does not apply – for example, companies whose only securities listed on NYSE are non-voting preferred and debt securities, passive business organizations, or issuers of securities listed pursuant to certain NYSE rules are not currently required to hold annual shareholder meetings. The NYSE Proposal would amend Section 302.00 to state that newly listed CEFs would also be exempt from the annual shareholder meeting requirements. Any CEF listed prior to the approval of the NYSE Proposal would remain subject to the annual shareholder meeting requirement. However, business development companies would still be required to comply with the shareholder meeting requirements.
In July 2024, the NYSE previously proposed to amend Section 302.00 to exempt all CEFs from the annual shareholder meeting requirement. The July 2024 proposal was later withdrawn by NYSE.
RIA CHARGED WITH CUSTODY RULE VIOLATIONS
In August 2025, the SEC announced that it had issued a cease-and-desist order against a registered investment adviser (the “RIA”), for violating Rule 206(4)-2 (the “Custody Rule”) under the Investment Advisers Act of 1940.
Under the Custody Rule, “it is a fraudulent, deceptive, or manipulative act, practice or course of business . . . for [a registered investment adviser] to have custody of client funds or securities unless” the adviser implements an enumerated set of requirements to prevent loss, misuse, or misappropriation of those funds and securities, including the following:
Qualified Custodian: Client funds and securities must be maintained with a qualified custodian.
Notice to Clients and Account Statements: RIAs must provide written notice to clients when an account has been opened on their behalf and have an articulable reasonable basis to believe the custodian sends quarterly account statements.
Independent Verification: If an RIA has custody, client assets must be verified annually by an independent public accountant via a surprise examination conducted under a written agreement.
The SEC found that, while acting in his capacity as co-trustee of two trusts that were advisory clients, the RIA’s President had (i) access and authority to obtain possession of trust funds and securities without the consent of the respective co-trustees, (ii) signatory authority to the same degree as a beneficial owner on four clients’ accounts, and (iii) acted as an authorized agent with power of attorney on five clients’ accounts where he had the ability to place orders, request disbursements, and make inquiries concerning account balances.
Because of these actions and the level of access to client accounts, the RIA was required to obtain surprise examinations in accordance with the Custody Rule. However, it failed to do so. Without admitting or denying the findings, the RIA settled the action with the SEC and was required to pay a civil penalty of $50,000.
SEC FURTHER EXTENDS COMPLIANCE DEADLINE FOR FORM PF
In September 2025, the SEC and the Commodity Futures Trading Commission (“CFTC”) announced that the compliance date for the February 2024 amendments to Form PF would be once more pushed back.
As noted in our Second Quarter 2025 Update, the CFTC and SEC last extended the compliance date to October 1, 2025. The announcement further extended the compliance date to October 1, 2026 in an effort to allow time for the SEC to complete a substantive review of the amendments to Form PF in accordance with a Presidential Memorandum sent to federal agencies by the Trump administration.
Form PF is the confidential reporting form used by certain SEC-registered investment advisers to private funds, including those that also are registered with the CFTC as commodity pool operators or commodity trading advisers. According to the SEC, the amendments to are intended to enhance the quality and usefulness of Form PF data for both the SEC and the Financial Stability Oversight Council by improving data accuracy, more completely capturing information on fund ownership, size, strategies, and exposures, and streamlining certain reporting elements without compromising investor protection or systemic risk analysis.
The SEC has stated that the extension would allow for sufficient time to review the amendments and should implement any additional amendments to Form PF.
SEC APPROVES TXSE
On September 30, 2025, the SEC approved the Texas Stock Exchange (“TXSE”) as a national securities exchange, making TXSE the first fully integrated stock exchange to receive SEC approval in decades. TXSE is headquartered in Dallas, Texas and intends to launch trading, exchange traded products and corporate listings in 2026, with the stated goal of being a top competitor of the New York Stock Exchange and Nasdaq.
In June of 2024, TXSE Group Inc., the parent company of TXSE, announced that the exchange planned to launch with $120 million in backing from investment firms including BlackRock and Citadel. Support for the exchange follows opinions that Texas was a prime location for a new exchange given the favorable regulatory and taxation policies in the state.[1]
LEAKED SEC REGULATORY AGENDA
In August 2025, the Office of Information and Regulatory Affairs, part of the Office of Management and Budget, briefly published, and then removed, several agency regulatory agendas, including the SEC’s semiannual Regulatory Flexibility Agenda detailing the Commission’s rulemaking priorities for the upcoming six months. The inadvertent draft publication, that was later confirmed by a source as authentic, offers insight into the rulemaking priorities under the SEC’s new leadership. While agendas are nonbinding and SEC priorities may change, prioritization suggests a regulatory posture oriented toward burden reduction alongside targeted modernization for funds and their advisers and is notable for several items directly affecting registered funds, exchange traded funds, and private funds. Among other things, the SEC alluded to potential amendments to Form N‑PORT, revisions to Rule 17a‑7, updates to custody requirements (including for digital assets), renewed attention on transfer agents, and a reassessment of the Consolidated Audit Trail (“CAT”). A few highlights from that agenda include:
Amendments to Form N‑PORT: According to the release, the Commission is reviewing the upcoming change for filing frequency of Form N-PORT. In 2027, filers will be required to begin filing Form N-PORT monthly. However, this change may be amended to a quarterly cadence. Changes to data elements within N-PORT are also being considered.
Amendments to Rule 17a‑7 under the Investment Company Act: The Commission is revisiting proposed amendments to Rule 17a-7, which grants exemptions to self-dealing transactions between registered investment companies and affiliated persons (also known as cross-trading). The hope of the industry is that this renewed interest leads to modernizations in the rule.
Amendments to the custody rules: Although the initial publication of the SEC agenda made a vague reference to amendments to custody rules, a subsequent proposed rule by the SEC clarified that the Commission will focus on improving and modernizing the regulations around the custody of advisory client and fund assets, including crypto assets.
Transfer agents (“TAs”): Although the agenda also signaled a renewed attention in transfer agent responsibilities as it pertains to distributed ledger technology and crypto assets, proposed rulemaking could have an effect on TAs writ-large and the funds they service.
Consolidated Audit Trail: While in the prerule stage, the Commission is considering comprehensive reforms of CAT, including the scope of information collected, addressing ongoing cost and data security concerns, and supporting clearly defined regulatory objectives.
Customer Identification Programs for RIAs and ERAs: In its final-rule stage, the Commission, along with the Department of the Treasury, is seeking to implement additional safeguards with respect to certain investment advisers that, among other things, requires investment advisers to implement reasonable procedures to verify the identities of their customers.
SEC STAFFING UPDATES
Margaret Ryan
Effective as of September 2, 2025, Judge Margaret Ryan was named the new Director of the Division of Enforcement of the SEC. Following the SEC’s announcement of Judge Ryan’s appointment, SEC Chairman Paul Atkins stated that “Judge Ryan will lead the Division guided by Congress’ original intent: enforcing the securities laws, particularly as they relate to fraud and manipulation.” Sam Waldon, the Acting Director of Enforcement, will return to his previous role as Chief Counsel for the Division of Enforcement.
Prior to this appointment, and since 2006, Judge Ryan has been a judge of the United States Court of Appeals for the Armed Forces, reaching senior status in 2020. Judge Ryan is also a lecturer and visiting professor at a handful of law schools, including Harvard and Notre Dame.
James Moloney
On September 10, 2025, the SEC announced that, effective in October of 2025, James Moloney will be named the Director of the Division of Corporation Finance. The Acting Director, Cicely LaMothe, will return to her role as a Deputy Director of the Division of Corporation Finance.
Moloney previously served at the SEC for six years from 1994 to 2000 as an attorney advisor and special counsel to the Office of Mergers & Acquisitions in the Division of Corporation Finance. For the last 25 years, Moloney has been at attorney at Gibson Dunn & Cutcher, making his way to equity partner. The Commission believes that Moloney’s understanding of corporate governance and disclosure, as well as his “eye toward supporting innovation and facilitating capital formation” will positively benefit the Division of Corporation Finance.
George Botic
Effective July 23, 2025, George Botic was designated to serve as the Acting Chair of the Public Company Accounting Oversight Board (“PCAOB”), following the resignation of the current PCAOB Chair, Erica Y. Williams, effective July 22, 2025. Botic is a Certified Public Accountant and has been a PCAOB board member since October of 2023. Additionally, prior to his tenue as a board member, Botic was the Director of the PCAOB’s Division of Registration and Inspections.
UPCOMING CONFERENCES
2025
Date
Host*
Event
Location
11/5
MFDF
In Focus: Audit Committee Chair
Virtual
11/5
ICI/IDC
ETF as a Share Class – Operational Considerations
Virtual
11/10
MFDF
AI and Third-Party Oversight
Webinar
11/13
MFDF
Mutual Fund CCO Compensation: The MPI Annual Survey Update
Webinar
11/20
ICI/IDC
Securities Law Developments Conference
New York, NY
11/20
ICI/IDC
Retail Alternatives and Closed-End Funds Conference
New York, NY
12/3-4
ICI/IDC
Foundations for Fund Directors
Virtual
12/9
ICI/IDC
Fixed Income Insights: Navigating Market Trends & Opportunities
Webinar
12/18
ICI/IDC
2025 Fair Valuation Pricing Survey Update
Webinar
2026
Date
Host*
Event
Location
1/26
MFDF
Ask Anything – ETF Edition
Virtual
1/26-28
MFDF
2026 Directors’ Institute
Naples, FL
2/3-5
ICI/IDC
2026 ICI Innovate
Houston, TX
2/10
MFDF
Director Discussion Series – Open Forum
Miami, FL
3/5
MFDF
2026 Fund Governance & Regulatory Insights Conference
Washington, DC
3/22-25
ICI/IDC
Investment Management Conference
Palm Desert, CA
4/14
MFDF
Director Discussion Series – Open Forum
Charlotte, NC
4/29 – 5/1
ICI/IDC
Leadership Summit
Washington, DC
4/29 – 5/1
ICI/IDC
Fund Directors Workshop
Washington, DC
TBD
ICI/IDC
ETF Conference
Nashville, TN
9/27-30
ICI/IDC
Tax and Accounting Conference
Marco Island, FL
10/26-28
ICI/IDC
Fund Directors Conference
Scottsdale, AZ
11/10
ICI/IDC
2026 Retail Alternatives and Closed-End Funds Conference
New York, NY
*Host Organization Key: Mutual Fund Directors Forum (“MFDF”), Independent Directors Council (“IDC”), and Investment Company Institute (“ICI”)
As the end of the year approaches, investment adviser representatives (“IARs”)[1] licensed in Colorado should be aware of the continuing education requirements necessary to maintain their IAR registration ahead of the compliance deadline set for December 31, 2025.
Background
On March 30, 2023, the Colorado Division of Securities adopted continuing education requirements (“CE Requirements”) for IARs. Under the CE Requirements, all licensed IARs of either Colorado-licensed investment advisers or federally covered investment advisers must complete 12 credits of continuing education (each a “CE Credit”) per calendar year, even if the IAR’s home state has not adopted similar rules.
An IAR with a home state other than Colorado will be considered in compliance with Colorado’s continuing education requirements so long as:
The IAR’s home state has adopted continuing education requirements that are at least as stringent as Colorado’s IAR CE Requirements, and
The IAR is in compliance with his or her home state requirements.
Although the CE Requirements were intended to go into effect for the 2024 calendar year, the Division adjusted the initial compliance date to allow for IARs to achieve compliance for the 2024 and 2025 calendar years (by completing a total of 24 CE Credits) by December 31, 2025.
Any IAR that fails to timely complete these CE Requirements runs the risk of being ineligible to renew his or her IAR registration for the 2026 calendar year.
Continuing Education Credits
Of the 12 required CE Credits, six must be related to industry products and practice (“Products and Practice Requirement”) and six must be related to ethics and professional responsibility (“Ethics Requirement”). An IAR who is registered as an agent of a Financial Industry Regulatory Authority (“FINRA”) member broker-dealer, and who complies with FINRA’s continuing education requirements, will be considered to be in compliance with the IAR CE Products and Practice Requirement if the FINRA CE Content meets certain baseline criteria determined by North American Securities Administrators Association (“NASAA”). Otherwise, for courses to count toward the required 12 CE Credit requirement, the content must be approved by NASAA and be administered by an Authorized Provider.
IARs will be able to monitor their IAR CE through FINRA’s FinPro System, and can find out more by using this guide. A list of Authorized Providers may be found here.
For additional guidance or support, please reach out to a member of our Asset Management Group or another member of the Davis Graham Team.
[1] Under C.R.S. § 11-51-201(9.6), investment adviser representatives are defined as “individuals who have a place of business in this state; who is a partner, officer, or director of an investment adviser; who occupies a status similar to or performs functions similar to those of a partner, officer, or director for an investment adviser; or who is employed or otherwise associated with an investment adviser who: (I) Makes recommendations or otherwise renders advice to clients regarding securities; (II) Manages securities accounts or portfolios for clients; (III) Determines which recommendation or advice regarding securities should be given to clients; or (IV) Supervises employees of, or persons otherwise associated with, an investment adviser or a federal covered adviser who perform any of the duties specified in this paragraph (a).”
The U.S. Securities and Exchange Commission (SEC) is rolling out major updates to its EDGAR (Electronic Data Gathering, Analysis, and Retrieval) system with the launch of EDGAR Next, a new account management platform. These changes will affect how public companies, investment companies, and individual filers access, manage, and secure their EDGAR accounts.
ALL FILERS MUST COMPLETE EDGAR NEXT ENROLLMENT BY SEPTEMBER 12, 2025, TO MAINTAIN UNINTERRUPTED SEC FILING ACCESS AND COMPLIANCE WITH DISCLOSURE OBLIGATIONS.
What is EDGAR Next?
EDGAR Next is the SEC’s modernization initiative designed to enhance security and control over the EDGAR filing process. It introduces a new login procedure via login.gov (with multi-factor authentication), role-based user access and administrator designation, and updated account management tools for all filers. These changes aim to enhance security, transparency, and administrative control over EDGAR access.
Who Must Enroll in EDGAR Next?
All public companies (including U.S. and foreign issuers), investment companies, Section 16 filers (such as officers, directors, and beneficial owners of more than 10% of a registered class), and any other entity or individual assisting with the submission of SEC filings must complete EDGAR Next enrollment.
Key EDGAR Next Enrollment Deadlines and Consequences
Enrollment Period Opens:
March 24, 2025
EDGAR Next opens for enrollment. Filers who have not been granted Form ID access by March 24, 2025 will be unable to submit filings until EDGAR Next enrollment is complete.
Compliance Deadline:
September 12, 2025
Filers who have not enrolled in EDGAR Next by September 12, 2025, will not be able to submit SEC filings until enrollment is complete.
Enrollment Period Ends:
December 19, 2025
After this date, to access existing EDGAR accounts, an amended Form ID will be required.
Beginning January 1, 2026, legacy EDGAR credentials will no longer be accepted, and filers who have not enrolled will be locked out of the system.
Failure to meet the SEC’s enrollment deadline will result in the loss of access to the EDGAR system and the inability to file required SEC reports. This may prevent your company from making required SEC filings, potentially resulting in compliance violations, penalties, reputational risk, and delayed closing of transactions.
Recommended Actions for EDGAR Next Enrollment
To ensure a smooth transition, we recommend clients take the following steps as soon as possible:
Designate an Account Administrator
Identify who in your organization will serve as an account administrator. If you use a filing agent, it will need to be added as an account administrator as well — contact your filing agent directly for assistance and its filing agent CIK.
Create Login.gov Accounts
All users who need EDGAR access (including administrators and signatories) must create a login.gov account with multi-factor authentication. Visit here for steps on how to create an account.
Gather Required Information
Prepare CIK numbers, CIK confirmation codes (CCCs), current EDGAR passphrase (if you have not reset your CCC or passphrase since September 2019, you must do so before enrolling — see here for more details), names and contact information for each account administrator (must match Login.gov accounts), and any relevant corporate details needed for enrollment. Note that no power of attorney or notarization is needed for enrollment (Form ID is not part of the EDGAR Next enrollment process).
Initiate and complete EDGAR Next Enrollment PROMPTLY
Follow the SEC’s instructions to transition your account to the new EDGAR Next system or, for new filers, to create a new EDGAR account, including setting up enhanced security features such as multi-factor authentication. We recommend that filers complete the enrollment process at least a week prior to the compliance deadline of September 12, 2025, to build a buffer for any unforeseen technical or administrative issues.
Verify Access After Enrollment
Ensure all authorized users can access the system and that account functionality is intact after enrollment.
Monitor SEC Communications
The SEC may release further instructions and updates; we will continue to track and inform you of key developments.
Stay Compliant — Act Now
The EDGAR Next transition will significantly affect your ability to meet SEC deadlines. We strongly encourage all clients to begin the EDGAR Next enrollment process as soon as possible to avoid potential disruptions.
For additional guidance or support, please reach out to a member of our Public Companies & Capital Markets group or another member of your Davis Graham team.
On August 1, 2025, the U.S. Environmental Protection Agency (EPA) issued a proposed rule to reconsider the 2009 Greenhouse Gas (GHG) Endangerment Finding (Endangerment Finding) and proposed to repeal all GHG emission standards for light-duty, medium-duty, and heavy-duty vehicles and engines promulgated under Section 202(a) of the Clean Air Act (CAA). See Reconsideration of 2009 Endangerment Finding and Greenhouse Gas Vehicle Standards, 90 Fed. Reg. 36,288 (Aug. 1, 2025) (Proposed Rule). EPA’s primary basis for the Proposed Rule is that EPA lacks statutory authority under CAA Section 202(a) to prescribe emission standards to address global climate change concerns in light of more recent Supreme Court decisions, and it also advances several alternative bases for the action. The Proposed Rule does not have any immediate impact on either the car manufacturing industry or any other industry, as it is not yet final. However, if finalized, the Proposed Rule would eliminate existing federal GHG requirements for new motor vehicles and engines, including compliance, reporting and certification obligations for manufacturers, importers, and regulated entities. Notably, the Proposed Rule does not impact the CAA provisions that support EPA’s fuel economy standards, Corporate Average Fuel Economy (CAFE) testing, and emission standards for criteria pollutants and hazardous air pollutants for motor vehicles and engines.
Clients should attentively track this rulemaking process, as EPA acknowledges that it has relied on the Endangerment Finding to promulgate regulations under other CAA provisions, and that it “ha[s] initiated or intend[s] to initiate separate rulemakings that will address any overlapping issues.” Id. at 36,298.
The Proposed Rule includes several primary and alternative legal rationales for rescinding the Endangerment Finding and GHG emission standards for motor vehicles and engines, which are detailed below.
Lack of Authority under CAA Section 202(a). EPA’s primary argument for rescinding the Endangerment Finding is that it does not have the statutory authority under CAA Section 202(a) to prescribe emission standards to address global climate change concerns. CAA Section 202(a) allows EPA to prescribe regulations for the emission of any air pollutant from engines that “cause, or contribute to, air pollution which may reasonably be anticipated to endanger public health or welfare.” Previously, EPA interpreted statutory silence in CAA Section 202(a) regarding global climate change impacts to public health and welfare to mean that it had the discretion to prescribe GHG standards for motor vehicles and engines. Id. at 36,299. However, EPA now interprets CAA Section 202(a) as only authorizing it to identify and regulate air pollutants that cause or contribute to air pollution that endangers public health and welfare “through local and regional exposures.” Id. at 36,300 (emphasis added). In doing so, EPA intends to distinguish “air pollution that impacts public health and welfare by its presence in the ambient air [(i.e., on a localized level)] from ‘air pollution’ consisting of six ‘well-mixed’ GHGs that, as conceptualized in the Endangerment Finding, impacts public health and welfare indirectly [(i.e., on a global level)] and not by its mere presence in the ambient air.” Id.
EPA relies on the recent Supreme Court decisions in Loper Bright Enterprises v. Raimondo, 603 U.S. 369 (2024), West Virginia v. EPA, 597 U.S. 697 (2022), and Utility Air Regulatory Group v. EPA, 573 U.S. 302 (2014) to support this change in interpretation. EPA reasons that the major questions doctrine set forth in West Virginia v. EPA and the overturning of Chevron deference in Loper Bright have led it to interpret the statutory silence in CAA Section 202(a) as a lack of clear authorization from Congress to regulate GHGs from motor vehicles and engines to address global climate change concerns. Id. at 36,305–36,306. EPA further explains that its change in interpretation is consistent with the “decades-long” implementation of CAA Section 202(a) and this recent Supreme Court precedent. Id. at 36,300.
Finally, EPA contends that it misinterpreted the Supreme Court’s decision in Massachusetts v. EPA, 549 U.S. 497 (2007), which vacated EPA’s denial of a petition for rulemaking to regulate carbon dioxide and GHGs from motor vehicles and led to EPA’s Endangerment Finding in 2009. Id. at 36,302. The Proposed Rule explains that following Massachusetts v. EPA, EPA erroneously interpreted the decision to mean that it was required to find that GHGs are subject to regulation under CAA Section 202(a). Id. The Proposed Rule explains that while Massachusetts v. EPA held that GHGs could be considered “air pollutants” under the CAA’s definition of “air pollutants” in Section 302(g), and therefore subject to regulation under CAA Section 202(a), subsequent Supreme Court decisions have clarified that the Massachusetts v. EPA decision did not require EPA to regulate GHGs under CAA Section 202(a) or to make the Endangerment Finding. Id.
Unreasonable Application of Statutory Standards to the Scientific Record. As an alternative, EPA argues that even if CAA Section 202(a) authorized EPA to address GHG emissions based on global climate change impacts, EPA unreasonably exercised that authority by severing the regulatory action into separate “endangerment” and standard-setting proceedings. Id. By severing the proceedings, EPA failed to consider adaptation to climate change, mitigation of GHG emissions, and costs when it issued the Endangerment Finding and standards in separate proceedings. Id. at 36,303. EPA now asserts that CAA Section 202(a) is an “integrated regulatory provision” that requires EPA to make an endangerment finding and prescribe emissions standards to alleviate those impacts in the same proceeding. Id. at 36,302–36,304.
Scientific Uncertainty and New Evidence. As another alternative, EPA asserts that the Endangerment Finding acknowledged “significant uncertainties related to climate change.” Id. at 36,308–36,310. And that new scientific evidence indicates that the Endangerment Finding was “unduly pessimistic” with respect to climate change and its impacts on public health and welfare. Id.
Lack of “Requisite Technology” to Address Identified Concerns. As a third alternative, EPA asserts that there is no “requisite technology” for light-, medium-, and heavy-duty vehicles that can meaningfully address global concentrations of GHGs in the upper atmosphere. Id. at 36,311. Moreover, “the impact of reducing all GHG emissions from motor vehicles and motor vehicle engines to zero would not result in a measurable impact on trends in climate change.” Id. at 36,312. Accordingly, the Proposed Rule concludes that this fact alone serves as an independent and sufficient basis for repealing the relevant GHG emission standards, because even if GHGs from motor vehicles and engines were eliminated, such reductions would not have a meaningful impact on the dangers associated with global climate change that were identified in the Endangerment Finding. Id.
The Proposed Rule signals that the second Trump Administration’s EPA is taking aggressive steps to fulfill its deregulatory promises made in a March 12, 2025, press release titled “EPA Launches Biggest Deregulatory Action in U.S. History.” In addition, the Proposed Rule appears to, at least initially, satisfy President Trump’s directive in Executive Order No. 14154 “Unleashing American Energy” for the EPA Administrator to provide recommendations to the Office of Management and Budget Director on the “legality and continuing applicability” of EPA’s prior Endangerment Finding, and attempt to further President Trump’s campaign promises to reduce the cost of living by “giving Americans the ability to purchase a safe and affordable car . . . while decreasing the cost of living on all products that trucks deliver.” See Proposed Rule Press Release (July 29, 2025).
While the Proposed Rule is specific to the GHG emission standards for vehicles and engines, EPA is “reconsidering additional endangerment findings and GHG emission standards issued under distinct provisions of the CAA in separate rulemakings.” 90 Fed. Reg. at 36,293. Therefore, EPA may propose additional rules in the coming months or years to rescind or reconsider GHG regulations for other regulated industries.
On July 3, 2025, the Department of the Interior (the “Department”) published an interim final rule (“Interim Final Rule”) in the Federal Register, effective immediately, that largely rescinds the Department’s regulations at 43 C.F.R. part 46 implementing the National Environmental Policy Act (“NEPA”). The Department is soliciting public comments on the Interim Final Rule through August 4, 2025.
Key Regulatory Changes
The Interim Final Rule rescinds the majority of the Department’s NEPA regulations at 43 C.F.R. part 46, retaining and revising only select provisions. The remaining regulations now focus on emergency response procedures, categorical exclusions, and the preparation of environmental documents by project applicants and contractors. All other NEPA procedures will be retained in the Department’s NEPA Handbook, incorporated within the Departmental Manual at 516 DM 1.
Summary of Retained and Revised Regulations
Emergency Responses (43 C.F.R. § 46.150). The Department maintains the provision allowing bureaus, in emergency situations, to bypass NEPA analysis for actions urgently needed to mitigate harm to life, property, or significant resources. For other emergency actions not immediately necessary to protect these interests, bureaus may utilize alternative NEPA compliance arrangements.
Categorical Exclusions (43 C.F.R. §§ 46.205, 46.210, 46.215). The Department has revised its categorical exclusion framework as follows:
Application of Multiple Categorical Exclusions. New provisions clarify that bureaus may apply multiple categorical exclusions to a single action and may rely on determinations made by other agencies or Department bureaus.
Procedures for Categorical Exclusions. The process for establishing, modifying, or removing categorical exclusions is now specified, with explicit clarification that such modifications do not themselves trigger NEPA analysis.
Removal of Certain Exclusions. Categorical exclusions for hazardous fuels reduction using prescribed fire and for post-fire rehabilitation activities have been eliminated.
Extraordinary Circumstances. Three categories have been removed from the list of “extraordinary circumstances” that preclude the use of categorical exclusions: actions with highly controversial environmental effects; actions potentially violating environmental protection laws; and actions with disproportionately high and adverse effects on low-income or minority populations.
References to Executive Orders. All references to Executive Orders in the list of categorical exclusions have been removed.
Environmental Documents (43 C.F.R. §§ 46.106, 46.107). The Department has retained and revised the regulation governing environmental documents prepared by contractors and project applicants, and has added a new section addressing related procedures.
Transition to the NEPA Handbook
The Department will house most of its NEPA implementation procedures in an updated section of the Departmental Manual (516 DM 1), referred to as the NEPA Handbook. The Department justifies this move by characterizing NEPA as a “purely procedural statute” with requirements applicable solely to internal processes. The Handbook’s non-codified status is intended to provide greater flexibility and responsiveness to evolving legal and policy developments.
The 124-page Handbook follows a similar structure to the Council on Environmental Quality’s (CEQ) prior NEPA regulations at 40 C.F.R. part 1500 and is organized into several key sections:
NEPA and Agency Planning
Environmental Impact Statements (EIS)
Efficient Environmental Reviews
Agency Decision-Making
Procedures for Applicant- and Contractor-Prepared Environmental Documents
Three appendices provide further detail:
Actions Normally Requiring an Environmental Assessment (EA) or EIS
Bureau Categorical Exclusions
Implementation Guidance to Bureaus, which sets forth additional guidance on nine NEPA concepts, including scoping, public involvement, use of existing NEPA documents, analytical requirements, significance determinations, and documentation protocols.
Notable Handbook Provisions and Their Implications
Alignment with Statutory Amendments. The Handbook incorporates statutory changes from the Fiscal Responsibility Act of 2023, including definitions at 42 U.S.C. § 4336e and new deadlines and page limits for EAs and EISs.
Reduced Public Participation and Public Review. The Handbook narrows public participation requirements in the EIS process. Unlike prior CEQ regulations, which required public comment on both the Notice of Intent (NOI) and draft EIS, and mandated publication of a final EIS before a Record of Decision (ROD), the Handbook only requires public comment in response to the NOI, consistent with 42 U.S.C. § 4336a(c). Moreover, there is no requirement to release a draft or final EIS prior to issuance of a ROD.
Applicant-Prepared NEPA Documents. Statutory amendments to NEPA allow project applicants and their contractors to prepare EAs and EISs. The Handbook further allows applicants and their contractors to prepare Findings of No Significant Impact (FONSIs) and decision documents. The Handbook then details the necessary independent review and evaluation of NEPA documents by the relevant bureau.
Implementation of Supreme Court Precedent. In response to the Supreme Court’s decision in Seven County Infrastructure Coalition v. Eagle County, the Handbook limits the scope of effects that must be considered in NEPA documents. Bureaus are not required to analyze environmental effects from other projects that are (1) separate in time or place, (2) outside the bureau’s regulatory authority, or (3) independently undertaken by third parties.
Conclusion
The Department’s Interim Final Rule represents a significant restructuring of its NEPA compliance framework, with immediate implications for agency procedures, public participation, and the scope of environmental review. Legal and compliance professionals should review the revised regulations and Handbook to assess impacts on ongoing and future projects. Comments on the Interim Final Rule must be submitted by August 4, 2025.
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