## Facts

- Maine’s Department of Transportation proposed a Sears Island project in upper Penobscot Bay, Maine, consisting of a 1,200-foot solid-fill causeway with rail and roadway access, a dry-cargo marine terminal, and an adjacent industrial park.
- Sears Island was an undeveloped, approximately 940-acre island; local planning and zoning anticipated industrial development once access and port infrastructure were built.
- Federal agencies, including the Federal Highway Administration and the U.S. Army Corps of Engineers, prepared multiple environmental assessments and issued Findings of No Significant Impact, choosing not to prepare an Environmental Impact Statement.
- Sierra Club challenged the federal funding and permitting decisions, arguing the project would significantly affect the environment, especially through induced secondary industrial development.

## Issues

1. What standard governs judicial review of an agency decision not to prepare an EIS, and how much deference is owed to a district court decision based primarily on an administrative record?
2. Whether the project was a major federal action significantly affecting the human environment, requiring an EIS, including analysis of reasonably foreseeable indirect and growth-inducing effects.

## Decision

- The First Circuit vacated the district court’s judgment upholding the agencies’ no-EIS determination and remanded with instructions to require preparation of an EIS.
- The court held the district court should set aside a no-EIS decision upon finding a substantial possibility that the action could significantly affect environmental quality.
- Because the district court’s ruling was largely record-based, the court of appeals conducted an independent review of the administrative record.
- The court concluded the agencies’ FONSIs were unlawful because the record showed significant environmental effects, particularly from foreseeable secondary industrial development.

## Legal Principles

- NEPA requires an EIS for major federal actions that significantly affect the quality of the human environment.
- An environmental assessment and FONSI cannot substitute for an EIS when there is a substantial possibility of significant environmental effects.
- The significance determination must account for reasonably foreseeable indirect effects, including growth-inducing and secondary development consequences tied to the initial federal action.
- Where a lower court decision rests primarily on the administrative record rather than live factfinding, an appellate court may review the record with substantial independence.

## Conclusion

The First Circuit held that NEPA required an EIS for the Sears Island causeway and port project because the administrative record demonstrated a substantial possibility of significant environmental effects, including reasonably foreseeable secondary industrial development that the agencies improperly minimized or ignored.


Sierra Club v. Marsh, 769 F.2d 868 (1st Cir. 1985)