Topic 1: Introduction to Administrative Law

Admin Law Outline

Topic 1: Introduction to Administrative Law

Definition: Administrative law is the body of general rules and principles governing administrative agencies (How they do their own work, and how work results can be viewed or reviewed by the President, Congress and Courts)
Functions: Administrative law is NOT the substantive law adjudicated by agencies, or the procedure followed by agencies
(1) Rulemaking- Regulations promulgated by agencies (CFR)
Under agency rulemaking power, agencies can pass criminal statutes violation of which can be a felony
(2) Adjudication- Social security/immigration decisions
Decide specific factual situations
More cases adjudicated in agencies than cases filed in federal courts
Source: Constitution, federal statutes, E.O.’s, court decision, and agency’s own rules and guidelines
Agency organization dictated by statute (NOT constitution)
Focus: Process-oriented (as opposed to tax law practiced by IRS)
Administrative Agencies: Any governmental authority other than a court or a legislative body- “All authorities and operating units of the government except for the constitutionally established entities” (Congress, President and Courts)
Created by statute (definitions under APA on page 1437 and 1404)
Goals: Admin law attempts to increase social/political freedom by making government interworking’s more transparent and encouraging individual gov’t participation
Many agencies have a division of functions to keep ALJ’s isolated
But not always – OSHA is the inspector, judge and jury
Newer agencies have more energy, before negative precedent
Output: Agencies make regulations (CFR), decide disputes, license activities or individuals, enforce regulations (inspect, penalties)
Not all elements are listed in organic statute- might be listed in later statutes

Types of Agencies: Two patterns for agency organization
Administrative Agencies: Headed by single administrator who serves at President’s pleasure, often within larger entities headed by members of President’s Cabinet
Non-Independent (within the executive branch)- led by one person
Pres. has near unlimited power to dismiss for whatever reason
Ex: OHSA or Dept. of Labor (usually Administrators)
Sometimes independent agencies are housed within administrative agencies (FERC within DOE- 5 members have term appointments and removal protection making it “independent”)
Independent Regulatory Commissions: Free standing bodies whose members can be removed from office by President only for “cause”
Until 1910 all agencies were within the executive branch (State, DOD, DOJ, etc.), then Congress created more agencies with a certain amount of independence from the executive branch
Sometimes headed by people (usually Commissioners) who have term tenure or for-cause removal protection- are not subject to immediate dismissal by President (with exceptions).
Sometimes independent agencies have a single individual who has term tenure and for cause removal protection (SSA)
Regulatory Agencies: Issuing rules, inspecting or punishing violation w/ governmental authority
Non-Regulatory:Agency reaches outside its own area to achieve results by traditional government means
Not using governmental powers (GSA- has an impact on things outside their spheres)
Ex: National Zoo is not a regulatory agency because they just regulate behavior within their sphere
Examples:Some agencies deal with small area- FCC deals with broadcasters exclusively, some with wide area- OSHA- anyone who employs someone
Non-Independent and Non-Regulatory: State department, FBI
Non-Independent and Regulatory: FDA, OSHA: Within HHS which is under the department controlled by an executive
Independent and Non-Regulatory: CIA, NASA, influence outside conduct
Independent and Regulatory: FTC, NRLB, NRC – insulated from Presidential control, multi-member heads, fixed terms, for-cause removal
Presidential Preferences
Carter- wanted to inventory all agencies
Reagan- wanted cutback on agencies (deregulation)
Many political initiatives require new agencies
Clinton- wanted to reform Medicaid, required new bureaucracy
Bush- 9/11 made him increase expansion in agency (size & number)
Obama- Greatly expanded administrative agencies
TARP, stimulus funds, auto industry, Dodd-Frank, CFPB
Issues: Alternatives to establishment of administrative agencies
Issue with unelected bureaucrats getting policy and discretionary power
Step 1: Is there a problem?  Do we need to get the government involved?
Organ donation- voluntary
Common law regimes: Courts
Statutory law regimes: Legislature, enforceable by Court
Step 2: Do we even need an agency to remedy the problem?
Need uniformity, special experience or expertise, etc.
Step 3: How should it be addressed?
Courts- Usually can address, unless there is no law to apply to the topic
Legislature- Congress can pass a statute setting out the substantive law, but sometimes don’t want congress making specialized decisions
Agencies- Give an existing agency new authority, or new agency?

Procedure
Congress has broad authority to create and structure agencies subject to certain constitutional limitations
Might think Agencies violate Separation of Powers (co-mingling of legislative, executive and judicial functions AND indep. agency’s insulation from presidential oversight)
But constitution authorizes Congress to make laws “necessary and proper” for ensuring powers are exercised effectively – (Art I, §8, cl. 18)
Agencies can only exercise powers they have been delegated, but Congress entrusts agencies with many policy-setting powers, and high “discretion”
Jurisdiction can be vague like “in the public interest” or “to protect public health”

Topic 2: Delegation of Regulatory Lawmaking Power (Rulemaking/Legislative Power)

Delegating to the President v. Cabinet
The Non-Delegation Doctrine: Legislative power delegated to Congress cannot be re-delegated to the Executive or to the Courts
Congress can’t delegate legislative powers to agency – Constitution gives congress responsibility to exercise “all legislative power” – (Art I §1)
When Congress delegates quasi-legislative power – might be abdicating responsibility to exercise powers its responsible for under Article I
Congress can’t delegate adjudicatory powers to an agency so that it undermines the federal courts’ authority to exercise “the judicial power of the US” – (Art III, §1)
When Congress delegates quasi-judicial power, worry it’s undermining powers conferred on federal courts by Article III
Contingency Doctrine: Executive isn’t legislating, just “filling in the details” and implementing a certain group of principles based on the occurrence of a condition that Congress wasn’t sure would happen
Article I: “All legislative power granted shall be vested in a Congress”
Courts must uphold statute unless unconstitutional (Marbury v. Mad.)
Ensure an orderly government administration- Congress responsive to popular will
Formalist: Cannot delegate adjudicative or legislative power to an agency because delegated power is “executive” not “legislative” - no difference in that power given to president or within the executive branch
Functionalist: Rejects theory that delegated power is really the president’s - whoever got the delegation has the power- decision-making now becomes subject to the APA or a sunshine statute

Delegation of Legislative Authority
To what extent can you delegate to an agency legislative and adjudicative power?
Aggrandizement- When congress tries to have more control over agencies than what is constitutionally allowable
Encroachment- Congress tries to allocate duties and responsibilities in a way that appears to violate a constitutional principle
Intelligible Principle Standard: So long as Congress lays down in legislation an intelligible principle to which person authorized to exercise the delegated authority is can conform, such action is NOT a forbidden delegation of legislative power (Misretta)
Found in the purpose section of organic statute OR can infer from other statutes OR legislative history OR problem itself OR common sense
Usually Court Congress to give broad rulemaking power to agencies – can give executive agencies power to take actions with legislative effects based on agency’s policy judgments as long as Congress give them an overarching policy within which to act (like “public interest”)
Analysis: Look at procedural protections as much as substantive standards
Agencies may try and reduce necessary power delegated to them- cure vagueness by adopting more procedural protection
Ex: FTC/FCC’s mandate is broad and vague, but so many procedural requirements, it’s ok (want transparency, comments, etc.)
Goals: Reason for upholding broad delegations is pragmatic- more functional. Practical understanding that “increasingly complex society . . . Congress simply cannot do its job absent an ability to delegate power under broad general directives” (Misretta)

The Brig Aurora(1813): Statute authorizing Pres. revive statute giving favorable trading status to France if Pres. felt countries were violating US neutral commerce
Usually delegate power to the head of a Cabinet or a free-standing agency who then delegate to internal units (President has to ascertain a fact)
Issue: Did the statute give the President too much legislative power by allowing him to decide when the statute imposing the embargo would be suspended?
Holding: No. The Court UPHELD presidential authorization to give favorable trading status to countries if they were violating neutral commerce under the Contingency Doctrine: President wasn’t legislating, just allowing previously enacted legislation to become effected
An area where the President has primary authority (dealing with foreign nations)
Rule: If an intelligible principle principal is present then the delegated power is “executive” not “legislative”
Field v. Clark(1892): Tariff Act – normally requires duty free imports, but Pres. could suspend if he felt that the other country was unfairly taxing US exports
The statutory delegation was to the President personally
Rule: Congress can enact legislation the effect of which depends on the President’s determination that a “named contingency” exists
Holding: UPHELD the Act’s allowance of presidential suspension of duty free imports if other country was unfairly taxing US import- It didn’t give president legislative powers, because it only gave him discretionary powers to execute the law in a certain way based on the occurrence of a specific condition
Waman: UPHELD Congress’ delegation of federalrules of process to SCOTUS – they are just filling in the details (not a legislative function)
US v. Grimaud(1911): Conviction of people who grazed on public land, Congress had given President power to make regulations to set aside land for public forest reserves
Statute didn’t let Secretary make rules “for any purpose,” but had to be rules to insure that these reservations are preserved
Holding: UPHELD Act- Difficult to separate legislative power to make laws from administrative authority to make regulations BUT congress can give agencies power to “fill in the details” without giving them actual legislative power
Expanded the Contingency Doctrine (Field, Brig) because here, the executive made the rules, not just implementing rules made by Congress
J. W. Hampton v US:(1928): Tariff Act of 1922 allowed President to change statutory schedule of tariffs on goods at President’s discretion if there was unequal exchange
(Taft): Congress cannot give up its legislative powers and give them to the President or Judiciary, BUT the extent of the assistance one branch can give to another are fixed “according to common sense and inherent necessities of the governmental coordination”
Rule: As long as Congress gives out an “intelligible principle” by which a person authorized to fix rates is directed to conform, its not a forbidden delegation of legislative power (president only executes the law, he doesn’t make it)
UPHELD- There was a sufficient intelligible principle for the agency to follow

Limitations on Delegation of Legislative Power:
Expansion of government during the passing of these two statutes before 2 cases
Government plagued by lack of transparency - where code was, when modified, etc.
Court had tremendous hostility to dramatic expansive of federal regulatory authority wanted opportunity to halt expansion (not have CFR, public comment, etc.)
Panama Refining v. Ryan (1935) (hot oil case): Statute allowed the President to regulate oil in excess of state quotas by executive order – change pricing/stop allow oil transport
Holding: Court found that this was an INVALID, impermissible delegation to the executive because there was NO intelligible principle for the President to follow, so President was virtually legislating, so that isn’t allowed
Congress can’t assign this power to the President, because Legislature should regulate IC commerce, and the 19 substantive standards were insufficient as an “intelligible principle” – too much agency discretion
Cardozo (dissent): Thought there was constitutional delegation- would have upheld
It shouldn’t matter the number of standards, because if there was a standard, and president complied with one, that’s allowed
Banzhaf says that Cardozo is correct here- do have standards by which to guide agency discretion to come into play
Schecter Poultryv. US (1935) (sick chicken case): Congress allowed Pres. to approve trade codes for fair competition (submitted by industry) if certain elements met
Holding: Was an INVALID delegation- violated delegation doctrine – even though there were standards, the standards weren’t well defined
Hughes: There were no explicit guidelines, on how to define “fair competition,” – can’t delegate to private groups an essential legislative function and there were no adequate administrative procedures for the approval of the trading codes
Setting standards for industries was much more liberal than yes/no to oil transport- leaves too much discretion to President to set standards
(Cardozo): Unlike Panama Refining, where all Pres. is authorized to do is to prohibit transportation, yes or no black/white- here he agreed with majority, said it violated delegation doctrine because there was no limit to the president’s power here. Power was not “canalized” but “unconfined and vagrant”
Notes: If you have sufficient procedural protections, that may overcome vague and general kind of delegation.
Ex: publish reasons for decision, have public comment period, etc.) (especially if their substantive standard is “within the public interest” then significant procedural protections)
Yakus v. US (1944): Congress authorized Administrator to promulgate regulations fixing “fair and equitable prices” during war (court may have given agency additional “war power”)
Rule: Should only say its an impermissible delegation if its impossible to decide whether the will of Congress has been followed or not
Holding: UPHELD- There are enough details set out that we can determine what Congress wanted – not too much discretion given to the agency here
Might be moving from a formalist emphasis on separation of powers to a functionalist concern with effective checks on delegated powers
Purpose of Delegation Doctrine:
(1) Provide guidance to the agencies
(2) Provide for a substantive standard when agency’s actions are under review by the courts (“intelligible principle”)
Functionalist Emphasis on Encroachment
Mistretta v. US: (1989): US sentencing commission- created federal crime penalties
Holding: UPHELD Congressional delegation to an agency set up in judicial branch because there was a sufficient intelligible principle that the authority could use
Blackmun: Functionalist: Separation of powers is flexible, no S of P violation here
Founders didn’t require that the branches be entirely separate and distinct, wanted to focus on effective government (Jackson in Youngstown- “separateness but interdependence, autonomy but reciprocity”)
Different characteristics that should inform commission’s judgment for penalties- so better left to a specialized body than the legislature
Ok to have some degree of comingling of functions, as long as there is no danger of aggrandizement or encroachment of powers

Trucking I: American Trucking v. EPA (1999): DC Circuit Court of Appeals
CAA required EPA to set “primary standard” to protect public health with adequate margin of safety, and a “secondary standard” to protect public welfare
Holding: The court STRUCK DOWN for lack of an “intelligible principle” to use- “protect public health” is too vague (what is the “requisite level of safety”?)
Like Benzene case: Could interpret statute to narrow what’s otherwise a more broad authority
The court wanted to give agency the opportunity to use an interpretation that doesn’t violate the delegation doctrine SO court allowed the agency to adopt a more precise standard that wouldn’t violate delegation doctrine
EPA needs to make a threshold finding setting how their standards were developed- otherwise too much influence over American life without justification without any constraints
Davis Principle- agency should adopt a more narrow construction
By supplementing substantive standard in the statute it cures problem.
Trucking II: American Trucking v. EPA (1999) DC Ct. Ap. Petition for Rehearing
EPA said that there was a limiting intelligible principle under the CAA
The court followed Chevron instead of Industrial Union and deferred to the agency’s reasonable interpretation of a statute of an ambiguous principle by which to guide its exercise of delegated authority
BUT the “intelligible principle” itself was ambiguous, and not clear that the agency applied the principle
Trucking III: Rehearing of American Trucking v. EPA (date?) Denying EPA’s Petition for Rehearing En Banc
The court UPHOLDS finding that “requisite to protect public health” was enough of an “intelligible principle”
Constitutional avoidance canon used- APA should be used to limit EPA’s discretion under the arbitrary and capricious standard
Davis’ Principle- agency can cure a weakness by coming up with an interpretation of its own- but this was REJECTED
The court said that it never suggested that an agency can cure an unconstitutional delegation of power by making a limiting interpretation of the statute
Trucking IV:Whitman v. Trucking Association (2001): EPA has authority to set AAQS
Whether EPA has to look at costs of achieving an adequate standard of safety
Scalia- Interpreted in its statutory and historical contact, §109 bars cost considerations for the NAAQS setting process-
Holding: Court UPHELD statute as delegation with sufficient “intelligible principle”
Provision requiring protection of public health granted EPA allowable discretion- “well within the outer limits of the non-delegation precedent”
EPA made judgments, but that’s not conclusive for delegation purposes- EPA wasn’t exercising legislative power, just implementing a statute

Notes: Don’t need intelligible principles to allow EPA to define “country elevators,” but would need intelligible principle to allowed EPA to interpret “public health”