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Forourwivesandbestfriends,forputtingupwithuswhilewewrite, RenateFunk
HollyV.Dawkins
—W.F.F.&R.H.S.
Chapter1 IntroductiontoAdministrativeLaw1
Chapter2 HowAgenciesFitintoOurSystemofSeparatedPowers23
Chapter3 Adjudication71
Chapter4 DueProcess107
Chapter5 Rulemaking139
Chapter6 TheAvailabilityofJudicialReview209
Chapter7 TheScopeofJudicialReview275
Chapter8 GovernmentAcquisitionofPrivateInformation331
Chapter9 PublicAccesstoGovernmentInformation361
Chapter1IntroductiontoAdministrativeLaw1
I.AdministrativeLaw—TheCourse1
a.OMB/EOReview66
1.ReviewUnderE.O.1286666
2.ReviewUndertheInformation(Data) QualityAct68
b.IndependentRegulatoryAgencies68 1.E.O.1286668
2.Information(Data)QualityAct69
4.LineItemVeto69
Chapter3Adjudication71
I.TheSubjectMatterofAdjudication72
II.FormalandInformalAdjudication76
A.FormalandInformalAdjudicationintheStates84
III.TheAPAProceduresforAdjudication84
A.NoticeRequirements85
B.TheBurdenofProof85
C.RulesofEvidence86
D.TheRoleoftheALJ88
E.TheCourseoftheProceeding89
F.TheRoleoftheAgency90
G.ExParteCommunications—5U.S.C.§557(d)92
H.SeparationofFunctions—5U.S.C.§554(d)94 1.FormalAdjudicationintheStates100
IV.ProceduresforInformalAdjudication100 V.ProceduresApplicabletoAllProceedings101
VI.AlternativeDisputeResolution(ADR)and AdministrativeLaw103
VII.Licensing103
Chapter4DueProcess107
I.IsDueProcessRequiredatAll?108
A.History109
B.ModernDueProcess110
1.ModernConceptof‘‘Property’’111
2.ModernConceptof‘‘Liberty’’115 a.LibertyandReputation115
b.LibertyandCorrectionalFacilities119
II.WhatProcessIsDue?121
A.Historically121
B.TheModernRule123
C.ParticularRequirements131
1.TheNeedforanImpartialJudge132
2.ExParteCommunications136
Chapter5Rulemaking139
I.TheNatureofRules139
A.‘‘Rule’’UndertheAPA140
B.LegislativeandNonlegislativeRules143
C.Rulesv.Orders144
II.BeginningRulemaking146
III.RulemakingProcedures148
A.RulesExemptfromSection553150
1.TheMilitaryandForeignAffairsExemption150 2.TheExemptionforMattersInvolvingAgency ManagementorPersonnel,PublicProperty, Loans,Grants,Benefits,andContracts152
B.RulesExceptedfromSection553’sNotice-andCommentRequirements154
1.InterpretativeRules,StatementsofPolicy,and ProceduralRules155
a.InterpretativeRules155 1.TheSubstantialImpactTest156
2.The‘‘LegallyBinding’’or‘‘ForceofLaw’’ Test157
a.Whetherintheabsenceoftherule therewouldnotbeanadequatebasis forenforcementactionorotheragency actiontoconferbenefitsorensure theperformanceofduties158
b.Whethertheruleinterpretsalegal standardorwhetheritmakespolicy159
c.Iftheagencyisinterpretinga legislativerule,whethertheclaimed interpretativeruleisconsistent withthelegislativeruleitis supposedlyinterpreting162
d.Whethertheagency contemporaneouslyindicatedthat itwasissuinganinterpretativerule163
e.Whetherthepersonsigningthe agencydocumenthadtheauthority tobindtheagencyormakelaw163
f.Doubtfulfactors164
g.Conclusion164
b.GeneralStatementsofPolicy165
c.RulesofAgencyOrganization,Procedure, orPractice171
1.SubstantialImpactTest172
2.‘‘EncodingaSubstantiveValueJudgment’’ Test173
2.WhentheAgencyFindsforGoodCauseThat NoticeandPublicProceduresAreImpracticable, Unnecessary,orContrarytothePublicInterest174
C.TheProceduresforFormalRulemaking176
D.TheProceduresofNotice-and-CommentRulemaking180
1.TheNotice180
2.TheComment182
3.TheFinalRule183
4.The‘‘LogicalOutgrowth’’Test184 E.ProceduresforRulesNotSubjecttoFormal RulemakingorNotice-and-CommentRulemaking187
F.NegotiatedRulemaking188
G.ConstitutionalandOtherJudiciallyCreated ProceduralRequirements190 1.ExParteCommunications191
2.DecisionMakers’BiasorPrejudice193 3.UndueInfluence195
H.OtherAdministrativelyorStatutorilyRequired Procedures—HybridRulemaking197 1.ExecutiveOrders199
2.NationalEnvironmentalPolicyAct202
3.RegulatoryFlexibilityAct203 4.UnfundedMandatesReformAct204
5.ThePaperworkReductionAct205
6.CongressionalReview205
7.InformationQualityAct206 8.Conclusion207
I.ReviewabilityGenerally210
A.Jurisdiction—StatutoryJurisdiction210
B.Jurisdiction—Standing213
1.ConstitutionallyRequiredStanding213
a.InjuryforStanding215
1.Recreational,Aesthetic,or EnvironmentalInjury215
2.RiskasInjury217
3.FearasInjury221
4.ProceduralInjury222
5.InformationalInjury223
6.OtherWidelySharedInjuries226
7.StatesasPlaintiffs227
b.CausationforStanding227
1.ProceduralViolationsandCausation227
2.Third-PartyActionsandCausation230
3.ContributionasCausation231
c.RedressabilityforStanding232
1.Third-PartyActionsand Redressability232
2.ProceduralViolationsand Redressability233
3.PartialRedressorAvoidance233
2.RepresentationalStanding234
3.PrudentialStanding235
II.ExceptionstoJudicialReviewUndertheAPA236
A.StatutoryPreclusion236
B.CommittedtoAgencyDiscretionbyLaw239
III.RequirementsforJudicialReviewUndertheAPA244
A.CausesofActionandtheZoneofInterests244
B.AgencyAction250
IV.ProblemsofTiming251
A.FinalAgencyAction252
B.ExhaustionofAdministrativeRemedies259
C.Ripeness266
V.PrimaryJurisdiction273
Chapter7TheScopeofJudicialReview275
I.ReviewofQuestionsofLaw277
A.StatutoryInterpretationandthe Chevron Doctrine277
B.InterpretationofRules295
II.SubstantialEvidenceReview298
A.WhenDoesaCourtReviewforSubstantialEvidence?299
B.WhatDoesSubstantialEvidenceMean?299
C.SubstantialEvidenceReviewinHybridRulemaking308
III.ArbitraryandCapriciousReview308
IV. DeNovo Review318
V.ReviewofAgencyActionUnlawfullyWithheldor UnreasonablyDelayed319
VI.Remedies322
VII.EquitableEstoppel325
VIII.TheEffectofJudicialDecisions327
A.ResJudicataandCollateralEstoppel327
1.AgainstPartiesSuingtheGovernment327 2.AgainsttheGovernment328
B.Non-Acquiescence328
Chapter8GovernmentAcquisitionofPrivate Information331
I.Introduction331
II.LegalLimitsonGovernmentAcquisitionofPrivate Information—InGeneral332
III.AdministrativeInspections—Fourth AmendmentLimits334
IV.ObtainingDocumentsandTestimony340 A.ReportingRequirements340 1.PaperworkReductionAct341 2.Subpoenas346
B.FourthAmendmentLimitsonReporting RequirementsandSubpoenas349
C.FifthAmendmentLimitsonReporting RequirementsandSubpoenas354
Chapter9PublicAccesstoGovernmentInformation361
I.Introduction361 II.FreedomofInformationAct362 A.InGeneral362
B.Exemptions370 Exemption1375 Exemption2376 Exemption3379 Exemption4382 Exemption5388 Exemption6391 Exemption7395
III.GovernmentintheSunshineAct400
Ifyouarelikeuswhenwewerelawstudents,youenrolledinacourseon administrativelawwithoutknowingexactlywhatthecoursewouldbe aboutorunderstandingwhatan administrativeagency is.Themysteriousnessis understandable.Administrativelawisliketheairwebreathe:invisibleyet pervasive.Administrativeagenciesaffectsomanyareasofourlivesthatwe takethemforgranted.Theyarepartoftheatmosphereofmodernlife,and, likethephysicalatmosphere,theyarenecessary(atleastinsomeform)to sustainmodernlife,buttheygetlittleattentionfrommostpeople. Nonetheless,lawstudentsneedtolearnaboutthembecausemostlawyers mustdealwiththem.
Thenear-invisibilityandpervasivenessofadministrativeagenciesmake administrativelawanexcitingandchallengingsubjecttolearn.Justas studentsofsciencelearnthattheairismadeupofmanydifferentelements thatservevariouslife-sustainingfunctions,studentsofadministrativelaw learnthat‘‘thebureaucracy’’ismadeupofmanydifferentadministrative agenciesthatservevariousgovernmentalfunctions.Nonetheless,justasall typesofphysicalmatteraresubjecttolawsofscience(suchasthelawof gravity),administrativeagenciesaregovernedbyprinciplesofadministrativelaw.Unfortunately,justasseeminglysimplelawsofsciencehave hiddencomplexities,seeminglystraightforwardprinciplesofadministrative lawcanbedifficulttoapplyinparticularsituations.
Indeed,administrativelawisanespeciallychallengingsubjectbecause youmustlearnboththesimilarities,aswellasdifferences,intheway governmentagenciesoperate.Allagencies,forexample,mustobeytheU.S. Constitution,aswellasthestatutesthatcreatethem.TheConstitutionstays thesame,ofcourse,regardlessoftheagency,butthestatutethatcreatesone agencywilldifferfromthestatutethatcreatesanotheragency.Inacourseon administrativelaw,youwilllearnlegalprinciplesthatarebroadlyapplicable tomanyormostgovernmentagencies.Todoso,however,youwillstudy material,includingjudicialopinions,statutes,andregulationsthatdealwith particularagencies.Itcanbedifficult—butitiscriticallyimportant—to distinguishthebroadlyapplicableprinciplesfromtheprinciplesthatjust applytoaparticularagency.Forthatreason,inacourseonadministrative law,evenmoresothaninotherlawschoolcourses,youmustbeabletosee theforestaswellasthetrees.
Thisbookwillhelpyoudothat.Inthe14yearssincethefirstedition, thousandsoflawstudentshaveusedthisbook.Theneedforafiftheditionis
aresultofstudentdemand.Thefirsttwochaptersgiveyoualayoftheland byprovidinganoverviewof(1)whatthesubjectofadministrativelawisall about,(2)whatadministrativeagenciesare,and(3)howtheyfitintothe governmentstructure.Laterchaptersgointodetailaboutthetwomajor activitiesinwhichadministrativeagenciesengage:rulemakingand adjudication.Followingthechaptersonrulemakingandadjudicationare twochaptersthatwillgiveyouadetailedandcarefullyorganizedpictureofa subjectthatisnearanddeartotheheartsofadministrativelawprofessors: judicialreviewofagencyaction.Finally,wediscusstwoadditionalagency activitiesthatarecoveredinsomecoursesonadministrativelaw: informationgatheringandinformationdisclosure.Wehaveorganizedthe bookasawhole,aswellaseachchapter,tosupplyyouwithadetailedmap oftheadministrativelawterrainthatshouldbeusefulinvirtuallyevery administrativelawcoursethatusesoneofthenationalcasebooks.
Inadditiontohelpingyouseethebigpicture,thisbookisdesignedto helpyouunderstandthedetails.Ineverychapter,wediscusseachtopicin enoughdepthtofacilitateasophisticatedunderstandingofthetopic.These discussionsincludedescriptionsofallofthemajor,relevantdecisionsof theU.S.SupremeCourt(throughJune2015),aswellasdescriptionsofthe majordoctrinalapproachestakenbylowerfederalcourts.Ourdiscussionof eachtopicisfollowedbyexamplesthatenableyoutotestyour understandingofthetopic,andbyexplanationsoftheexamplesthat,we hope,willdeepenyourunderstandingofthetopic.Manyoftheseexamples arebasedonactualcasesthathavebeendecidedbyfederalcourts.This formatwillbringthesometimesabstractprinciplesofadministrativelaw downtoearth.
Youcanusethisbookeithertoprepareforclassortoprepareforexams, orforbothpurposes.Thechaptersareself-contained,andeachchapteris carefullyorganizedtoenableyoutoquicklyandeasilytolocatethetopics thatyoucoverinyourcourse.Thus,youdonotneedtoreadthebookfrom covertocover,nordoyouneedtoreadthechaptersintheorderinwhich theyarepresented.Inparticular,youcanreadourgeneraldiscussionofa topictoclearupthingsthatremainunclearfromclassoryourcasebook, ortoreviewtopicsattheendofthesemester.Youcanalso,duringoratthe endofthesemester,consulttheexamplesandexplanationsforthetopics coveredinyourcoursetomakesurethatyouhaveahandleonthattopicorto getadditional,concreteillustrationsoftopics.Wehopeyoufindthisbook helpful.Wewelcomeyourcommentsandsuggestionsforimprovement.
WilliamF.Funk RichardH.Seamon
September2015
Administrative Law
1
Introductionto AdministrativeLaw
Administrativelaw,thoughoftendreary,canbeofhugeimportancetothe day-to-daylivesofAmericans.
—WashingtonPost editorial,June23,2001
I.ADMINISTRATIVELAW—THECOURSE
Administrativelawislargelyaboutprocedure—theprocedurethatgovernmentagenciesmustfollowinordertotakeactionthataffectsprivateparties. AdministrativelawastaughtinAmericanlawschoolsisabasiccoursethat, despitetheapproximately19differentcasebooksinthefield,doesnotdiffer greatlyamongschoolsorteachers.Allthecoursesfocusonfederaladministrativelaw,althoughsomemaytouchonstateadministrativelawinthe particularstateinwhichthecourseisgiven.AllfocusonthefederalAdministrativeProcedureAct(APA),ratherthanonthemyriadotherfederalstatutesthatgovernthevariousagencies’activities.Moreover,despitethefocus ontheAPA,administrativelawcoursesareinvariablytaughtthroughthe casemethod,relyingalmostexclusivelyonjudicialopinionstoexplicatethe law.Allcovertheproceduralrequirementsagenciesmustfollowintaking variousactions;allincludetherelationshipsamongthebranchesofgovernment,makingadministrativelawsortofanadvancedpoliticalscienceor constitutionallawcourse;andalladdresshowcourtsreviewagencyaction. Governmentregulationofprivateconductandconstitutionaldueprocess alsofiguresheavilyinalladministrativelawcourses.
Professors,dependingupontheirbackgroundandpointofview,may stressoneoftheseareasmorethanothers,andtheorderinwhichtheyare addressedmaydiffer,butultimatelythecourseshavemoreincommonthan theydiffer.
Astheintroductoryquotationfromthe WashingtonPost suggests,the subjectofadministrativelawhasrarelybeenconsideredintrinsicallyinteresting.Unliketorts,forinstance,itssubjectmatterdoesnotoftenrelateto everydaylife.Atthesametime,ExecutiveBranchagenciesmakeruleson mattersasdiverseasenvironmentalprotection,workplacesafety,wholesale electricitypricecaps,andagriculturalpricesupports.Federalstudentaid requirementsareanotherexampleofagencyregulations.Inaddition, federalagenciesmakeindividualizeddecisionsaffectingsomeofthemost importantaspectsofpeople’slives,fromhealthcarecoveragedecisionsto decisionsondeportation.Stateagenciesmakedecisionsgoverningwhowill beadmittedtothebarandwhowillbedisbarred,asjustoneexample. Inotherwords,administrativelawactuallyaffectsyouinreallife.Moreover, ifyoucareatallabouthowyourgovernmentfunctions,youshouldcare deeplyaboutadministrativelaw,becauseitgovernsmostofwhatgovernmentdoes.Itisallaboutpowerandhowtocontrolit.
Also,administrativelawisreallynotallthatdifficult;itisnottaxlaw. Whiletherearestatutoryprovisions,mostadministrativelawisdetermined fromjudicialopinions.Likemostareasofthelawthatarelargelydrivenby judicialdecisions—asopposedtostatutoryorregulatorytext—some administrativelawisclear-cut,black-lettermaterial,whereasotherparts ofitinvolveclearprinciples,usuallyeasilystated(oftenwithmultipart tests),buttheapplicationofwhichisfraughtwithfuzziness.Finally, someadministrativelawisstillupforgrabs;thecourtshavenotyetworked itout,orlegislaturespassnewlawsthatconfusetheissues.
Thisbookcanhelpsortoutwhatisclearfromwhatisfuzzyinthelaw, andthroughexamplesandexplanationshelptoreducethefuzzinessinthe areasthatarenotsoclear-cutbutwhichrelyonacontextualapplicationofa generalprinciple.Thisbookalsocanidentifythoseareasthatarenotyet workedoutand,inthoseareasatleast,identifytheissuesthatareunclear andthelikelyrangeinwhichanultimateanswerislikelytooccur.
II.OVERVIEWOFTHEHISTORYOF ADMINISTRATIVELAW
Howthelawhasdevelopedovertimeoftenhelpstoilluminatehowjudges arelikelytoruletoday.Thismaybeparticularlytrueofadministrativelaw. Thesubjectmatterofadministrativelawitselfisrelativelyrecentinthe law.ProfessorFelixFrankfurterofHarvardLawSchool,laterSupremeCourt
Justice,iscreditedwithauthoringin1932oneofthefirstcasebookson administrativelaw.PriortotheGreatDepression,whichbeganwiththe stockmarketcrashin1929,theprevailingwisdomreflectedinbothcourts andlegislatureswaslaissez-faireeconomictheory.Thistheoryischaracterized bytheabsenceofgovernmentregulationofbusinesswiththeexceptionof publicutilities(e.g.,gas,water,electricity,andtelephonecompanies), so-callednaturalmonopolies.What‘‘administrative’’lawexistedconsisted oftheconstitutionallawdoctrineof‘‘separationofpowers,’’whichyoumay alreadyhavestudiedinconstitutionallaw,butwhichadministrativelaw coursesrevisitwithaparticularfocus.Forexample,two-thirdsofFrankfurter’scasebookcoveredseparationofpowers,withtheremainingone-third dedicatedtoparticulartypesofadministrativefunctions—utilityregulation, taxation,immigration,and‘‘miscellaneous.’’Comparethattoyourcasebook.
TheGreatDepression,however,spawnedtheNewDeal,withitsbelief intheabilityofgovernmentregulationofbusinesstocuretheexcessesof laissez-fairecapitalism.Toimplementthisregulation,Congresscreated agenciesthatweresupposedtobeapoliticalandhavethenecessarytechnical expertisetomanageindustriesinascientificmanner.Thisledtoan explosivegrowthinbusinessregulation,which,becausetheagenciesin realityweremorepoliticalandlessexpertthantheiridealconception,in turnledtoanexplosivegrowthinlitigationinwhichbusinesseschallenged theirregulation.Afteraninitialperiodinwhich,onthebasisofvarious constitutionalprovisions,theSupremeCourtresistedwide-scalegovernmentregulationofbusiness,theCourtaccededtotheconstitutionalityof mostoftheNewDealagenciesandregulations.Instead,theCourtnow developedacommonlawtocontroltheseagencies.Thiscommonlaw emphasizedproceduralregularityinagencydecisionmaking,oftenmirroringtheproceduresofcourts,andappliedadegreeofjudicialoversightofthe substantiveadequacyoftheagency’sdecisions.Businessinterests,notsatisfiedwiththisjudiciallycreatedregime,lobbiedCongressformoreprotectivelegislation.In1946,theAdministrativeProcedureAct(getusedto callingittheAPA)waspassedasacompromisebetweenbusinessinterests andtheExecutiveBranch.Atthesametime,theAmericanBarAssociation andtheNationalConferenceofCommissionersonUniformStateLaws approvedaModelStateAPA,whichslowlybutsurelyprovidedthebasis fortheadoptionofadministrativeprocedureactsinalmosteverystate.
TheAPAin1946washardlyarevolutionarylaw.Rather,itlargely codifiedthedevelopingcommonlaw.Ithasremainedlargelyunamended sincethattime,butithasbeensubjecttosubstantialjudicialinterpretation overtheyearsthathastakentheAPAwellbeyonditsliteraltext.Inparticular, thisoccurredduringthe1970s,thesecondgreatwaveofgovernment regulationaftertheNewDeal.DuringtheNewDeal,mostofthegovernmentregulationwasregulationofparticularindustriesintheireconomic activities.Forexample,theFederalCommunicationsCommission(FCC)
wascreatedtoregulatethebroadcastindustry,andtheSecuritiesand ExchangeCommission(SEC)wascreatedtoregulatethesecuritiesindustry. Inthe1970s,thethrustwassomewhatdifferent;nowtheemphasiswason protectingtheenvironmentorhealthandsafetyacrossindustries. Forexample,theEnvironmentalProtectionAgency(EPA)wascreatedto protecttheenvironment;theOccupationalSafetyandHealthAdministration (OSHA)wascreatedtoprotectworkersintheworkplace;andtheConsumer ProductSafetyCommission(CPSC)wascreatedtoprotectconsumers. WhereastheoriginalAPAwasenactedalmostexclusivelytoprotectthe subjectsofgovernmentregulation—thoseactuallyregulatedbythegovernmentandwholobbiedfortheAPA’spassage—thejudicialresponsein the1970swasprimarily(althoughnotexclusively)aimedatprotectingthe intendedbeneficiariesofthenewregulation:workers,consumers,and thosewhoappreciatedtheenvironment.
Duringthe1970s,therealsowasexplosivegrowthinwhatareknownas government‘‘entitlements’’programs. Entitlementsprograms entitleapersonto agovernmentbenefitifthepersonmeetscertainqualifications.For example,ifemployedpersonsbecomedisabledsothattheycannotwork inanyjob,theymayqualifyforSocialSecurityDisabilitypayments.Historically,thesetypesofgovernmentbenefitswerenotconsidered‘‘property’’undertheDueProcessClause,sothatpersonsreceivingthemhadno proceduralprotectionsagainstgovernmentterminationoftheirbenefits. Thesamejudicialsolicitudeforbeneficiariesofgovernmentregulatory programsalsocametobereflectedinjudicialtreatmentofbeneficiaries ofentitlementsprograms,asthecourtsexpandedthenotionofproperty protectedbytheDueProcessClause.
Morerecently,startinginthe1980sandcontinuingtothepresent, concernsoverthecostandefficacyofvariousgovernmentregulations haveledtoanumberofnewlawsandPresidentialExecutiveOrders designedto‘‘reform’’governmentregulation,generallytomakeitmore cost-effective,ortoeliminateitbyderegulatingformerlyregulatedareas. Forexample,theInterstateCommerceCommission(thefirstmultimember,independentregulatoryagency,createdinthenineteenthcentury toregulatetheratesthatinterstaterailroadscouldchargeshippersand expandedlatertoregulateinterstatetruckingratesaswell)waseliminated in1996.WhileasyetthereformershavenotactuallyamendedtheAPA, therehavebeenvariousattemptstodoso,andCongresshaspassedanumber ofstatutesthatcreatenewproceduralrequirementsapplicabletovarious agencyactions.Forexample,theRegulatoryFlexibilityActrequiresagencies toengageinacost-benefitanalysisofanyregulationthathasasubstantial impactonsmallbusinesses.
Thisconcernforthecostandefficiencyofgovernmentregulationhas notbeenlimitedtotheExecutiveandLegislativeBranches.Perhapsreflectingthe12yearsofjudicialappointmentsbyconservativePresidentsRonald
Reagan,GeorgeHerbertWalkerBush,andGeorgeW.Bush,thecourtsalso seemtobemoresolicitousoftheburdensonindustryimposedbygovernmentregulationsandlesssolicitousofthosewhoseektoretaintheirgovernmentbenefits.
Thisbriefandsimplistichistoryofadministrativelawmayhelpto explainhowthecaselawhasdevelopedovertime.Inparticular,itmay helptoexplainhowacourtapplyinga‘‘test’’articulatedbythecourtsatan earliertimemayreacharesultseeminglycontrarytowhatearliercourts mighthaveheld.
III.OVERVIEWOFTHEADMINISTRATIVESTRUCTURE
Asyoulearnedinschool,CongressmakesthelawsandthePresidentis responsibleforexecutingthoselaws.Ofcourse,thePresidenthimselfcannotcarryoutallthoselaws;hemustutilizetheservicesoftheofficersand employeesoftheExecutiveBranch.
A.AgenciesGenerally
Whatisanagency?TheAPAdefines agency forpurposesofitsprovisionsas ‘‘eachauthorityoftheGovernmentoftheUnitedStates,whetherornotitis withinorsubjecttoreviewbyanotheragency,’’andthenitexemptsvarious entities,mostnotablyCongress,thecourts,andthegovernmentsofthe DistrictofColumbiaandterritories. See 5U.S.C.§551(1).In Franklinv.Massachusetts ,505U.S.788(1992),theSupremeCourtinterpretedtheAPAalso toexcludethePresidentfromthedefinitionofanagency.Otherthanthese exceptions,however,theAPA’sdefinitionisbroad,includingavastarrayof differenttypesofentities.Ofcourse,statesandstateagenciesarenotsubject totheAPA.TheyarenotauthoritiesofthegovernmentoftheUnitedStates.
Historically,themostimportantagencieswere‘‘departments,’’the headsofwhichconstitutedthePresident’s‘‘Cabinet,’’orclosestadvisory group.OtherthantheAttorneyGeneral,theheadsofCabinetDepartments holdthetitle‘‘Secretary,’’andeachisappointedbythePresidentafterSenate confirmation.Todaythereare15Cabinet-levelDepartments:
(1)Agriculture
(2)Commerce
(3)Defense,whichcontainsthreenon-Cabinet-levelDepartments: AirForce,Army,andNavy
(4)Education
(5)Energy
(6)HealthandHumanServices
(7)HomelandSecurity
(8)HousingandUrbanDevelopment
(9)Interior
(10)Justice
(11)Labor
(12)State
(13)Transportation
(14)Treasury
(15)VeteransAffairs
TheproliferationofDepartmentsandtheincreasingdemandsontheir headshaveunderminedthehistoricimportanceoftheCabinetasthe primaryadvisorybodytothePresident.InrecentyearsthisrolehasincreasinglybeenassumedbyWhiteHouseadvisors,whoarenotsubjecttothe requirementofSenateconfirmationthatisapplicabletoheadsofagencies. Mostrecently,therehasbeensomecriticismofthenamingbythePresident ofsuchadvisorsas‘‘czars’’ofvarioussubject-matterareasandtheiralleged influenceovertheagencyanddepartmentheads.SomemembersofCongresswouldliketoseethesepositionssubjecttoSenateapproval.
Departmentsnormallycontainanumberofagencies.Theyaretoo numeroustolist,butexamplesincludetheForestService(USFS)inthe DepartmentofAgriculture;theBureauoftheCensusintheCommerce Department;theFoodandDrugAdministrationintheDepartmentofHealth andHumanServices;theFishandWildlifeServiceintheDepartmentofthe Interior;theFederalBureauofInvestigationintheDepartmentofJustice;the FederalAviationAdministration(FAA)intheDepartmentofTransportation; andtheInternalRevenueService(IRS)intheTreasuryDepartment.Notethe varietyofnamesforthesesub-departmentalagencies,including‘‘service,’’ ‘‘bureau,’’‘‘administration,’’andothers.Theheadsoftheseagenciesalso havevarioustitles,suchasAdministratororDirector,andusuallytheyare appointedbythePresident.Otherwise,theyareappointedbytheheadofthe Department.Thedifferencesinthenamesoftheagenciesandthetitlesof theirheadshavenolegalsignificance.
TherealsoareagenciesoutsideofDepartments.Someareveryimportant,suchastheEPA,theCentralIntelligenceAgency,theUnitedStates PostalService,andtheSocialSecurityAdministration.Othersarenotas wellknown,suchastheFarmCreditAdministration,theUnitedStates InformationAgency,andtheUnitedStatesInternationalDevelopment CooperationAgency.Theheadsoftheseagenciesalsoareappointedby thePresidentwiththeadviceandconsentoftheSenate.
AlloftheseagenciesareconsideredpartoftheExecutiveBranch, meaningtheyaresubjecttothedirectionandcontrolofthePresidentas theheadoftheExecutiveBranch.
1.IntroductiontoAdministrativeLaw
B.IndependentRegulatoryAgencies
OnecategoryofagenciesisoftenconsideredoutsideoftheExecutive Branch—the‘‘independentregulatoryagencies.’’ Thereareabout15 suchagencies,includingtheFCC,theSEC,theFederalTradeCommission (FTC),theNationalLaborRelationsBoard(NLRB),theNuclearRegulatory Commission(NRC),andtheFederalReserveBoard.Theyarecalled ‘‘independent’’becausetheygenerallysharecertaincharacteristicsthatinsulatethemfromthatcontrolbythePresidenttowhichnormalexecutive agenciesaresubject.Thesecharacteristicstypicallyare:(1)theyareheaded bymulti-membergroups,ratherthanasingleagencyhead;(2)nomore thanasimplemajorityofthesemembersmaycomefromonepoliticalparty; (3)themembersofthegrouphavefixed,staggeredterms,sothattheir termsdonotexpireatthesametime;and(4)theycanonlyberemoved fromtheirpositionsfor‘‘cause,’’unlikemostexecutiveofficials,whoserve atthepleasureofthePresident.
Examples
1.IstheEconomicRegulatoryAdministration(ERA)anindependentregulatoryagency?TheERAisasubdivisionwithintheDepartmentof EnergyandwascreatedbytheDepartmentofEnergyOrganization Act,42U.S.C.§7136.ItprovidesthattheERAshallbeheadedbyan Administrator.
2.IstheCPSCanindependentregulatoryagency?
Explanations
1.No,theERAisnotanindependentregulatoryagency.Onewaytodeterminewhetheranagencyisanindependentregulatoryagencyistofindthe lawthatcreateditanddeterminewhetherithasthefourcharacteristicsofan independentregulatoryagency.ThestatutecreatingtheERAprovidesthatit isheadedbyanAdministrator.Therefore,itisnotheadedbyamultimembergroupandcannotbeanindependentregulatoryagency.Another wayistolookupthedefinitionof independentregulatoryagency inthePaperworkReductionAct,44U.S.C.§3502(5).Thedefinitioncontainsalistof alltheagenciesgenerallyconsideredtobeindependentregulatoryagencies,andalthoughthelegaleffectofthatdefinitionislimitedtothePaperworkReductionAct,thislistisconsistentwithgeneralunderstanding.
1.Actually,oneso-calledindependentregulatoryagency,theFederalEnergyRegulatory Commission,islocatedadministrativelywithintheDepartmentofEnergy(DOE),butitis notsubjecttothedirectionoftheSecretaryofEnergy.
Finally,aprettyaccurateshortcutwaytodetermineifanagencyisan independentregulatoryagencyistocheckwhetherthenameoftheagency containsthetitle‘‘commission’’or‘‘board.’’Ifso,theagencyisverylikely tobeanindependentregulatoryagency,becausethetitlereflectsthatthe agencyisledbyamulti-membergroupratherthanasinglehead— Secretary,Administrator,Director,etc.
2.Yes,theCPSCisanindependentregulatoryagency.Itwascreatedbythe ConsumerProductSafetyAct,15U.S.C.§2051etseq.Thatactreferstothe CPSCas‘‘anindependentregulatorycommission’’;itestablishesthatthe CPSCisgovernedbyfivecommissioners(includingtheChair)appointed bythePresidentwiththeadviceandconsentoftheSenate;eachisappointed forafixedtermofsevenyears,exceptthattheinitialappointmentswere staggeredsothattheirtermsexpiredoverafive-yearperiod,ratherthanall inthesameyear;nomorethanthreecommissionerscancomefromthe samepoliticalparty;andthePresidentcanremovecommissioners‘‘for neglectofdutyormalfeasanceinofficebutfornoothercause.’’
Example
WhatdoesitmeantosaytheCPSCisheadedbyamulti-membergroup?
Explanation
FivecommissionersmakeupthegoverningbodyoftheCPSC,comparedto thesingleAdministratoroftheERA.AlthoughoneistheChair,theChairhas onlyonevote,liketheotherCommissioners.Otherindependentregulatory agenciesmayhaveasfewasthreemembersorasmanyasseven,butmost havefivemembers,liketheCPSC.Inmostoftheseagencies,themembers arecalled‘‘Commissioners’’(becausetheyareinaCommission),butinan agencyknownasa‘‘Board’’(suchastheNLRBortheFederalReserve Board),themembersaresimply‘‘MembersoftheBoard.’’IftheCPSC wishestodecidewhethertoadoptanewconsumerproductsafety regulation,forexample,itwouldrequirethevotesofamajorityofthe Commissionerstoadoptthatregulation.Similarly,whenevertheagency setsorchangespolicy,itdecidestodoitthroughthemechanismofa majorityvote,likealegislativeassembly.IntheERA,ontheotherhand, thereisonlyasingleAdministrator;ifshewishestoadoptaregulation,she candosoonherown.Therearenovotes.
Independentregulatoryagencies,likeExecutiveBranchagencies,have subordinateofficers.IntheCPSC,forexample,thereisanExecutiveDirector
andseveralAssociateExecutiveDirectors.Theseofficersgenerallyanswerto theentiremembershipoftheCommissionorBoardastotheperformanceof theirfunctions,althoughgenerallytheChairoftheCommissionorBoardis responsibleforinternalagencyadministrativematters.
Example
IftheCPSCisanindependentregulatoryagencyandtheERAisnot,howis theCPSCmoreindependentthantheERA?
Explanation
Theso-called independence ofindependentregulatoryagenciesreferstotheir independencefromPresidentialcontrol.Thisindependence,however,is relativeratherthanabsolute.Thatis,theindependentregulatoryagencies aresomewhatmoreindependentofPresidentialcontrol,andmuchofthat independenceisaproductofhistoryandculture,notlaw.First,thefactthat theagencyiscontrolledbyseveralpersons,ratherthanone,makesitless amenabletodirection;itissimplyhardertocontrolseveralpersonsthanjust one.Moreimportant,Presidentialcontrolandinfluenceovermostexecutive officers,suchastheAdministratoroftheERA,resultsfromthefactthatthe Presidentappointsthemandmayremovethematwill.Theyusuallyhaveno fixedtermofoffice.Instead,theyserve‘‘atthepleasureofthePresident.’’ Thus,whenPresidentBarackObamareplacedPresidentGeorgeW.Bush,he dismissedmostoftheappointedexecutiveofficialswhohadnotalready resigned.Hethencouldappointthosepersonswhosharedhisvision.Later, iftheyceasetosharethatvision,hemaysimplyreplacethem.
TheCommissionersoftheCPSCandotherindependentregulatoryagencies,ontheotherhand,becauseoftheirfixedandstaggeredterms,remainin officewhenanewPresidentiselected.Generally,thePresidentcanremove themonlyfor‘‘cause,’’suchasmalfeasanceinofficeorneglectofduty. Becauseittakesanumberofyearsforthetermsofamajorityofthemembers ofacommissiontorunout,itmaytakeanumberofyearsforthePresidentto beabletoappointamajorityofmemberswhosupporthisprogram. Forexample,theFCChasfivemembers,eachofwhomisappointedfora five-yearterm.Thus,everyyearoneCommissioner’sappointmentrunsout, providinganopportunityforthePresidenttoappointanewCommissioner. Atthisrate,however,itwilltakeatleastthreeyearsbeforeanewPresident canappointasimplemajorityoftheCommission.Evenafterappointing them,unliketheAdministratoroftheERA,thePresidentcannotsimply removethemifhedoesnotlikewhattheyaredoing.
Finally,thelimitationthatnomorethanasimplemajorityofthe CommissionbefromonepartylimitswhomthePresidentcanappoint andensuresthatatleastsomeCommissionerswillbefromadifferent partythanthePresident.AgainusingtheFCCasanexample,imagine thataDemocraticPresidentreplacesaRepublicanPresidentwhohasbeen inofficeforeightyears.TheRepublicanPresidentwillhaveappointedallthe CommissionersinofficewhenthenewPresidentisinaugurated.Nevertheless,ofthefiveCommissioners,onlythreemaybeRepublicans(nomore thanasimplemajoritycanbefromoneparty),leavingtwoDemocratson theCommissionevenunderaRepublicanPresident.IftheDemocraticmemberswerethefirstwhosetermsranout,thenewDemocraticPresident wouldhavetowaitthreeyearsbeforehecouldmakeamajorityofthe CommissionDemocraticmembers.IftheRepublicanmemberswerethe firstwhosetermsranout,theDemocraticPresidentcouldinthefirstyear createaDemocraticmajority,butthenwouldhavetoappointRepublicans inthenexttwoyears,sothatnomorethanthreememberswereDemocrats. TheselegalrestrictionsasapracticalmattercanmakeindependentregulatoryagenciessomewhatindependentofthePresident,butmuchofthese agencies’independencestemsfromaperceptioninthepoliticalculturethat theyaresupposedtobemoreindependentthanCabinetDepartments.After all,Congresscreatedthemwiththisintent,whichisgenerallyrespectedby thePresidentandprotectedbyCongressinthepoliticalarena.Forexample, whenPresidentReaganissuedanExecutiveOrderonregulatoryreformin 1981,directingagenciestoconsidercostsandbenefitsinissuingnewregulations,theAttorneyGeneraladvisedhimthatasalegalmatterhecould imposeitontheindependentregulatoryagenciesaswellasontheExecutive Branchagencies,butthatasapoliticalmattertherewouldbeconsiderable concernaboutsuchaPresidentialdirectiontotheindependentregulatory agencies.Asaresult,thePresidentdidnotdirecttheOrdertothe independentregulatoryagencies.Tosomeextentsubsequentexecutive ordersonregulatoryreformhavebeenextendedtotheindependentregulatoryagencies,butthoseagenciesarestillnotsubjecttothesameoversight undertheordersasdootherexecutiveagencies.
Theindependenceoftheseagenciescanbeoverstated.First,the Presidentdoesappoint(withtheadviceandconsentoftheSenate)the ChairsoftheindependentregulatoryagenciesfromamongtheirCommissioners.Normally,anewlyelectedPresidentchoosesthenewChairfrom amongthoseontheCommission.TheChairoftheCPSC,liketheChairsof otherindependentregulatoryagencies,istheadministrativeheadofthe agency,liketheChairofacommitteeistheadministrativeheadofacommittee.WhiletheChairscannotmakepolicydecisionsfortheagencies, whichrequiremajorityvotesoftheCommissioners,theiradministrative powersgivethemreal,practicalpowerbeyondtheironevote. Forexample,theChairstypicallyareauthorizedtohirepersonnelemployed
