The End of Regulation by Guidance Document?

EPA has issued a final rule governing its issuance of guidance documents, declaring that the Rule will lead to enhanced transparency and help ensure that guidance documents are not improperly treated as legally binding requirements by the EPA or by the regulated community. In many instances over the years, guidance documents were issued without public input, even though the policy or interpretation in the guidance document created binding requirements applicable to the regulated community. This Rule ends that practice.

On October 9, 2019, President Trump issued an executive order, “Promoting the Rule of Law Through Improved Agency Guidance Documents.” It declared that agencies sometimes used guidance documents “to regulate the public without following the rulemaking [that is notice and comment] procedures of the” Administrative Procedure Act. It directed that agencies must treat guidance documents as non-binding both in law and in practice, take public input into account in formulating guidance documents, and make guidance documents readily available to the public.

According to EPA, the Rule meets these requirements, and more. The Rule provides definitions of “guidance document” and “significant guidance document,” minimum requirements for a “guidance document” and additional requirements for “significant guidance documents,” procedures for the public to petition the Agency for modification or withdrawal of guidance documents, and an online portal (the EPA Guidance Portal) to identify EPA guidance documents for the public.

A “guidance document” is a statement of general applicability, intended to have future effect on the behavior of regulated parties, that sets forth a policy on a statutory, regulatory, or technical issue, or an interpretation of a statute or regulation. There are a few exclusions form this broad definition, such as rules subject to notice and comment and rules of agency procedure and practice or internal guidance not intended to have substantial future effect on the behavior of regulated parties. Generally, a “significant guidance document” is one that may reasonably be anticipated to lead to an annual effect on the economy of $100 million or more.

All guidance documents must, among other things, include the term “guidance,” include the citation to the statute or regulation to which the guidance document applies or which it interprets, and avoid mandatory language such as ‘shall’ or ‘must.’ Further, it must include a disclaimer that the contents do not have the force and effect of law and that it does not bind the public in any way. Importantly, any guidance document issued by an EPA Regional Office must receive concurrence from an appointed EPA official at EPA headquarters. A significant guidance document must adhere to these requirements, plus it must be subject to notice and comment before finalization.

EPA also included a provision allowing any member of the public to petition EPA for the modification, withdrawal, or reinstatement of a guidance document. EPA will make information about petitions received available to the public and indicated that it should respond to a petition in no more than 90 calendar days after receiving the petition.

Finally, the Rule requires that all guidance documents be included in the EPA Guidance Portal. The Portal currently exists (www.EPA.gov/guidance) and contains the documents meeting the definition of a “guidance document.” The web-page contains the disclaimer that EPA’s guidance documents lack the force and effect of law agency and that it may not cite, use, or rely on any guidance that is not included in the Portal. The executive order and the Rule allow the issuance and use of guidance documents while providing public input and access and general procedures for issuance. Of greater significance and importance to the regulated community, there is some relief from the use of binding guidance documents issued without public knowledge or input.

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