## Facts

- The Clean Air Act regulates hazardous air pollutants by requiring stringent MACT standards for “major sources” and less stringent controls for “area sources,” based on emissions thresholds.
- In 1995, EPA guidance stated that once a facility became a major source subject to MACT, it could not later avoid MACT by reducing emissions and reclassifying as an area source (“once in, always in”).
- In 2018, EPA issued a memorandum superseding the 1995 guidance and stating that a source may reclassify from major to area status “at any time” if it limits its potential emissions below major-source thresholds.
- Environmental organizations and the State of California petitioned for direct review in the D.C. Circuit, asserting that the 2018 memorandum would allow sources to shed MACT obligations and increase hazardous emissions.
- Petitioners argued the memorandum was final agency action and an unlawful legislative rule adopted without notice and comment, and also misinterpreted Clean Air Act § 112.
- EPA and industry intervenors argued the memorandum was nonbinding guidance with no immediate legal effect, and that any challenge must await a later permitting or enforcement action applying the memorandum.

## Issues

1. Whether EPA’s 2018 reclassification memorandum is “final agency action” reviewable in the court of appeals under the Clean Air Act and the APA.
2. If reviewable, whether the memorandum is an unlawful legislative rule issued without notice-and-comment and/or an incorrect interpretation of Clean Air Act § 112.

## Decision

- The court dismissed the petitions for lack of subject-matter jurisdiction.
- Applying the Bennett v. Spear finality framework, the court assumed (without deciding) the memorandum could satisfy the “consummation” prong.
- The court held the memorandum failed Bennett’s second prong because it did not determine rights or obligations and did not itself produce legal consequences.
- The court did not reach whether the memorandum was a legislative rule or whether it correctly construed Clean Air Act § 112.
- A dissent would have found the memorandum final and reviewable because it effectively changed the regulatory regime governing MACT obligations.

## Legal Principles

- An agency action is reviewable as “final” only if it (1) marks the consummation of the agency’s decisionmaking process and (2) determines rights or obligations or creates legal consequences.
- Agency guidance that states an agency’s current interpretation, does not itself impose requirements, and has effects only through later permitting or enforcement decisions is generally not final agency action.
- Under the Clean Air Act’s direct-review provision, courts of appeals lack jurisdiction over non-final agency guidance; regulated parties and affected challengers may seek review when the agency applies the interpretation in a subsequent final action.

## Conclusion

The D.C. Circuit held that EPA’s memorandum allowing major sources to reclassify as area sources was nonbinding guidance with no independent legal effect, and therefore not final agency action subject to immediate judicial review; challenges must await a later final permitting, rulemaking, or enforcement action applying the memorandum.


Cal. Comtys. Against Toxics v. EPA, 934 F.3d 627 (D.C. Cir. 2019)