## Facts

- Title V of the Clean Air Act requires stationary sources to obtain operating permits from state or local permitting authorities under EPA-approved permit programs.
- EPA regulations require Title V permits to include “periodic monitoring,” and EPA may object to proposed permits; if EPA objects, the permitting authority may not issue the permit.
- In 1998, EPA issued a “Periodic Monitoring Guidance” document addressing how permitting authorities should satisfy the periodic monitoring requirement.
- The Guidance directed permitting authorities to conduct “sufficiency” reviews of existing monitoring in applicable requirements and to add monitoring conditions to permits when EPA deemed existing monitoring inadequate, including where underlying standards already contained monitoring provisions.
- Electric power companies and industry trade associations petitioned for review, arguing the Guidance effectively imposed new monitoring duties without notice-and-comment rulemaking.
- Petitioners also sought, in the alternative, review of EPA’s 1992 Title V implementing rule.

## Issues

1. Whether the 1998 Periodic Monitoring Guidance constituted final agency action subject to judicial review.
2. Whether the Guidance was, in substance, a legislative rule that amended or expanded existing monitoring requirements and therefore required notice-and-comment procedures.
3. Whether petitioners could obtain review of, or relief from, the 1992 Title V monitoring rule.

## Decision

- The court held the Periodic Monitoring Guidance was final agency action because it reflected EPA’s definitive position and had direct legal consequences for permitting authorities and regulated entities.
- The court held the Guidance operated as a binding legislative rule by effectively compelling permitting authorities to add monitoring and by expanding the scope of existing regulations.
- The court vacated the Guidance for failure to proceed through required notice-and-comment rulemaking under the Clean Air Act and the Administrative Procedure Act.
- The court declined to grant broader relief as to the 1992 rule; challenges to that rule were largely barred by the Clean Air Act’s time limits for judicial review.

## Legal Principles

- A document labeled “guidance” may be reviewable final agency action when it represents the agency’s settled position and produces legal consequences, including by effectively controlling regulated parties through the agency’s approval or objection authority.
- An agency pronouncement that demands compliance and creates new obligations, or expands regulatory requirements beyond existing regulatory text, functions as a legislative rule and is invalid absent notice-and-comment rulemaking.
- Regulated entities cannot avoid statutory time limits for challenging regulations by recasting an untimely direct challenge as a collateral attack in later litigation, absent a valid basis for review.

## Conclusion

The D.C. Circuit set aside EPA’s Title V Periodic Monitoring Guidance because, despite its label, it operated as final, binding agency action that expanded monitoring obligations and effectively amended existing requirements without notice-and-comment procedures.


Appalachian Power Co. v. EPA, 208 F.3d 1015 (D.C. Cir. 2000)