---
id: T01
parent: S02
milestone: M001
provides:
  - "PolicyFoundryConfig root settings model with YAML + env var merge"
  - "LLMConfig, SourcesConfig, TargetsConfig, OutputConfig nested models"
  - "load_config() entry point with validation error handling"
  - "Comma-separated env var list parsing via NoDecode + field_validator"
requires: []
affects: []
key_files: []
key_decisions: []
patterns_established: []
observability_surfaces: []
drill_down_paths: []
duration: 3min
verification_result: passed
completed_at: 2026-03-08
blocker_discovered: false
---
# T01: 02-configuration-system 01

**# Phase 2 Plan 1: Config Models and Loader Summary**

## What Happened

# Phase 2 Plan 1: Config Models and Loader Summary

**Pydantic Settings config system with YAML file loading, env var overrides, and 4-layer merge priority chain (global YAML < local YAML < env vars < init kwargs)**

## Performance

- **Duration:** 3 min
- **Started:** 2026-03-08T17:45:47Z
- **Completed:** 2026-03-08T17:49:07Z
- **Tasks:** 2 (TDD, 4 commits total)
- **Files modified:** 8

## Accomplishments
- Pydantic Settings models for LLM, sources, targets, and output configuration with sensible defaults (ollama, llama3.2, rich output)
- Config loader with 4-layer merge priority: global YAML < local YAML < env vars < init kwargs
- Comma-separated env var list parsing for security_group_ids and log_paths
- ConfigValidationError integration with field name extraction from Pydantic errors
- 22 config tests + 48 Phase 1 tests all passing (70 total)

## Task Commits

Each task was committed atomically (TDD: test then feat):

1. **Task 1: Config models with TDD tests**
   - `7b2d882` (test) - add failing tests for config models
   - `f363cb7` (feat) - implement config models with pydantic-settings

2. **Task 2: Config loader with source priority and TDD tests**
   - `50cba8d` (test) - add failing tests for config loader
   - `a4e1ecb` (feat) - implement config loader with source priority chain

## Files Created/Modified
- `src/policyfoundry/config/models.py` - Pydantic Settings models: LLMConfig, SourcesConfig, TargetsConfig, OutputConfig, PolicyFoundryConfig
- `src/policyfoundry/config/loader.py` - load_config() with ValidationError-to-ConfigValidationError wrapping
- `src/policyfoundry/config/__init__.py` - Public API re-exports for all models and load_config
- `tests/test_config/__init__.py` - Test package init
- `tests/test_config/conftest.py` - Shared fixtures: clean_env, tmp_config_dir, sample_yaml_content
- `tests/test_config/test_models.py` - 12 tests covering model defaults, custom values, comma-separated parsing
- `tests/test_config/test_loader.py` - 10 tests covering YAML loading, env overrides, merge priority, validation errors
- `pyproject.toml` - Added pydantic-settings[yaml]>=2.13 dependency

## Decisions Made
- Used NoDecode + field_validator for comma-separated lists -- this is the pydantic-settings native pattern, avoids requiring JSON syntax in env vars
- Nested models (LLMConfig, SourcesConfig, etc.) inherit from BaseModel not BaseSettings -- only the root PolicyFoundryConfig needs settings machinery
- YAML sources are conditionally added to the priority chain only if the file exists on disk -- avoids FileNotFoundError and matches user expectation that missing config files use defaults

## Deviations from Plan

None - plan executed exactly as written.

## Issues Encountered

None.

## User Setup Required

None - no external service configuration required.

## Next Phase Readiness
- Config models and loader ready for Plan 02-02 (unknown key detection, config template, source annotations)
- All downstream phases (LLM integration, CLI) can import load_config() and PolicyFoundryConfig
- Test fixtures established for config isolation (clean_env, monkeypatch Path.home/cwd)

## Self-Check: PASSED

- All 8 created files exist on disk
- All 4 task commits verified (7b2d882, f363cb7, 50cba8d, a4e1ecb)
- 70 tests passing (22 config + 48 Phase 1)
- ruff: clean
- pyright: clean

---
*Phase: 02-configuration-system*
*Completed: 2026-03-08*
