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DC Circuit upholds SILs guidance

DC Circuit decision in Sierra Club v EPA

On April 7, 2020, the U.S. Court of Appeals for the District of Columbia Circuit (DC Circuit) held in Sierra Club v. EPA, No 18-1167, that the Sierra Club’s challenge to EPA’s “Guidance on Significant Impacts Levels for Ozone and Fine Particles in the Prevention of Significant Deterioration Permitting Program” (SILs Guidance) was not reviewable final agency action. The decision represents a significant win for EPA. NSR Law Blog previously discussed the SILs Guidance in May 2018 and June 2018, which see for a copy of the guidance and a discussion of its significance.


Sierra Club argued that the SILs Guidance was final agency policy subject to review. EPA argued that it was not final agency guidance and that final decisions are reached through the permitting process and EPA did not mandate state action in the SILs Guidance.

The DC Circuit began by noting that after Dalton Trucking v. EPA, 808 F.3d 875, 879 (D.C. Cir. 2015), “under [CAA] section 307(b)(1), subject matter jurisdiction and venue are not coterminous” and that “just because an agency action may have national applicability does not mean it is final such that it can be reviewed immediately in this court.” The DC Circuit then quoted the Supreme Court’s decision in Bennett v. Spear, 520 U.S. 155 (1997), as setting the test: First, “the action must ‘mark the consummation of the agency’s decisionmaking process …. And second, the action must be one by which rights or obligations have been determined, or from which legal consequences will flow.’” Sierra Club, slip op. at 8-9 (quoting Bennett, 520 U.S. at 177-78). In assessing the second prong, the DC Circuit said it uses a “pragmatic” inquiry and considers “the actual legal effect” on “regulated entities,” the agency’s characterization of the guidance,” and “whether the agency has applied the guidance as if it were binding…” Sierra Club, slip op. at 11-12 (quoting National Mining Ass’n v. McCarthy, 758 F.3d 243, 253 (D.C. Cir. 2014). The DC Circuit then looked to its decisions in Valero Energy Corp. v. EPA, 927 F.3d 532 (D.C. Cir. 2019) and California Communities Against Air Toxics v. EPA, 934 F.3d 627 (D.C. Cir. 2019). In both, the EPA decision imposed no direct penalties or restrictions on parties, no choice between costly compliance and risk of penalty, and a way to challenge decisions and was found not to be final. Turning to the SILs Guidance, the DC Circuit ruled:

Assessing the SILs Guidance under Hawkes and in accordance with Valero and California Communities, we find it is not final agency action. Given the specific nature of the statutory regime, the SILs Guidance imposes no obligations, prohibitions or restrictions on regulated entities, does not subject them to new penalties or enforcement risks, preserves the discretion of permitting authorities, requires any permitting decision relying on the Guidance be supported with a robust record, and does not prevent challenges to individual permitting decisions. The SILs Guidance is not sufficient to support a permitting decision – simply quoting the SILs Guidance is not enough to justify a permitting decision without more evidence in the record, including technical and legal documents. See SILs Guidance at 19. It is also not necessary for a permitting decision – permitting authorities are free to completely ignore it. See id. at 19-20. As such, we find the SILs Guidance does not result in “direct and appreciable legal consequences” as required under prong two of Bennett. See 520 U.S. at 178.

Sierra Club, slip op. at 13. The DC Circuit noted that the amount of discretion states continued to have under the guidance was an important consideration. The DC Circuit also rejected Sierra Club’s invocation of the Ciba-Geigy line of cases (which typically apply to cease and desist letters), finding that the guidance was not like that encompassed in that line of cases.

In a separate concurring opinion, Judge Wilkins opined about whether review of a subsequent challenge to a permitting decision relying on the SILs Guidance should be heard in the DC Circuit or elsewhere, concluding that it should be in the DC Circuit. Judge Randolph, commented that “As to Judge Wilkins’ separate concurring opinion, I see no reason to decide what we would decide if only the case before us were a different case.”


The DC Circuit’s decision dismissing the Sierra Club’s challenge to the SILs Guidance means that the Guidance will remain useful authority for state permitting authorities and applicants in resolving when a cumulative impact analysis is required and when, if a de minimis exceedance of a NAAQS is shown, it may be excused as not really contributing to a NAAQS exceedance. There are several important caveats:

  1. The permitting authority and applicant must rest the decision to exclude further work on more than just the SILs Guidance, meaning that some additional analysis and discussion of whether a threat to the NAAQS is present is required in the record.

  2. Additional justification, perhaps based on the closer monitoring data, trends, and conservatism in modeling, likely is required to justify a decision to exclude a NAAQS or increment exceedance based on the SILs Guidance. Failure by a state permitting authority or applicant to include this additional justification may once more draw the SILs Guidance status into jeopardy.

State permitting authorities would be well advised to conduct some modeling or ambient monitoring analysis to bolster their approaches for making de minimis determinations that “do not cause or contribute” to a NAAQS or increment exceedance, as this will undoubtedly be the next challenge.

With respect to Judge Wilkins’ pondering that future action on this issue should go through the EAB and thus be reviewable only in the DC Circuit (and not any of his fellow circuits), Judge Randolph’s response is apropos.

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