On March 12, the U.S. Department of Justice (DOJ) Environment and Natural Resources Division (ENRD) issued guidance ending its decades-long practice of permitting private defendants in civil settlements to expend funds to provide environmentally beneficial goods and services to third parties in lieu of civil penalty payments. Defendants have long preferred to undertake supplemental environmental projects (SEPs) in lieu of paying larger penalties, and government enforcement lawyers saw SEPs as a valuable tool to encourage settlements. DOJ now finds that these SEPs violate the federal Miscellaneous Receipts Act, which requires federal officers receiving funds on behalf of the United States to deposit those funds into the United States Treasury. “Moving forward, [SEPs] will no longer be part of the suite of relief the Environment and Natural Resources Division seeks in its cases (unless specifically authorized by Congress), both in light of their inconsistency with law and their departure from sound enforcement practices,” according to ENRD’s memorandum. ENRD’s new policy is prospective and will not affect SEPs in existing settlements.