Administrative Law Outline

AdminLawOberdiekFall09.doc
I.                   The Delegation of Authority to Agencies
Animating Question: What amount of legislative or judicial power can be entrusted initially to an agency by Congress—the governmental body creating it?
A.                The Delegation Issue
Delegation – legislative grant of authority to an administrative agency; such grant can be assigned (i) on an industry wide basis (e.g. FCC, Nuclear Regulatory Commission) or (ii) to enforce certain norms throughout the economy (e.g. FTC to ban unfair methods of competition, OSHA/EPA to ensure health and safety).
Inherent Danger of Delegation – agencies wield powers that are typical of each of the three branches of government (rulemaking, investigation, adjudication). The delegation of these combined powers raises questions of separation of powers.
Justification for Delegation – there are institutional advantages to delegation: (i) legislature may be unable to specify detailed rules of conduct for every regulated field; (ii)an agency with flexible decision-making procedures and responsibility for limited subject matter are better equipped to develop sound, coherent policies in novel or rapidly changing fields of activity; (iii) where subject matter of regulation is technical or complex, or knowledge of the regulated field is essential, agency will have superior experience and expertise; (iv) agencies can provide uniformity and predictability by setting ground rules and applying them consistently.
B.                 Development of the Doctrine
Non-Delegation Doctrine – The Constitution limits Congress’s ability to confer power on administrative agencies; some delegations are so broad that they confer legislative powers, which is barred by Article I § 1 of the Constitution.[1] Theoretical Critique – agency’s role in implementing regulatory statute is nothing more than the exercise of executive power, even if the agency plays some sort of a lawmaking role.
Intelligible Principle Standard – A delegation must contain an intelligible principle to which the agency must conform.[2] The focus of judicial inquiry thus becomes whether the legislature has provided sufficient standards to limit the scope of agency discretion.
 
Timeline of the Non-Delegation Doctrine:
Early Cases – Court consistently upholds delegations by minimizing their significance (although there are broad delegations involved which allowed agencies broad policy discretion). See Grimaud (1911) (agency has power to “fill up the details” of the legislative will).  
Highwater of Non-Delegation Doctrine – doctrine is aggressively enforced in reaction to broad delegations during expansion of modern administrative state by FDR.
Panama Refining (1935) – Court strikes down NIRA provision granting President the power to prohibit interstate shipments of contraband oil, finding that statute grants President absolutely no guidance as to the circumstances under which he should impose the prohibition.
Beneficial Side-Effect – due to procedural defects in the case, legislation is passed requiring federal agencies to publish official texts of their regulations in the Federal Register.
Schechter Poultry (1935) – statute in NIRA enabling agency to issue “codes of fair competition” for particular industries if the code “tended to effectuate the policy of this title” is struck down. Court could not find a clear policy directive in the legislation. Court also emphasizes the procedural deficiencies in NIRA – did not require agency to hold trial-type hearings, or provide interested persons notice and to participate in challenged decision, or opportunity for judicial review to those adversely affected. This stood in contrast to earlier delegations of authority to ICC and FTC.
Leniency of the Doctrine – since 1935, Congress continues to grant sweeping, vaguely defined powers to administrative agencies, but the Court has not invalidated any other statutes on non-delegation grounds. 
Leniency exemplified by Yakus (1944) – Court upholds delegation empowering an agency Administrator to promulgate standards that would be “generally fair and equitable and effectuate the enumerated purposes of this Act.” Court notes that constitutional problems arise only if legislation is so lacking in standards that “it would be impossible in a proper proceeding to ascertain whether the will of Congress has been obeyed.”
C.                Modern Non-Delegation Controversies
Modern cases signal a possible future reevaluation of the leniency of the non-delegation doctrine and intelligible principle standard.
 
Benzene Case (1980) – OSHA regulation directs Secretary of Labor to issue rules requiring employers to protect employees “to the extent feasible” from harm due to toxic substances in the workplace. Secretary promulgates expensive regulation to minimize exposure to benzene. Plurality strikes down the rule, determining that the Secretary had not made all the findings required by the statute to promulgate rule (that it posed substantial risk of harm).
Rehnquist Concurrence – argues that the statutory phrase “to the extent feasible” is an unconstitutional delegation to the Secretary because it allows Congress to avoid resolving hard questions about when employers may take some risks of injury to employees due to the high costs of protective measures. Resolving fundamental, politically divisive policy issues is the essence of legislative authority and cannot be left to politically unresponsive administrator.
American Trucking (DC Cir. 1999, S.Ct. 2001) – Clean Air Act directs agency to set air quality standards at a level “requisite to protect the public health with an adequate margin of safety.” EPA promulgates rule setting limits on emissions of particulates. 
DC Cir. – strikes down rule, asserting agency had not articulated intelligible principle to channel the exercise of discretion. EPA fails to state intelligibly how much is too much of a health risk, since any exposure would entail some risk. Court applies NDD unusually by allowing agency supply its own intelligible principle.
S.Ct. – rejects the idea that agency can supply its own intelligible principle to cure an unconstitutional delegation. Court claims it would be internally contradictory, because the prescription of the standard that Congress had omitted would itself be an exercise of forbidden legislative authority.  Court upholds act as constitutional delegation, because air quality standards must be “requisite” to protect public health.
Modern Argument for Stronger Non-Delegation Doctrine: Congressional Abdication – Congress has too great a temptation to make use of open-ended delegations, to insulate itself from public blame for controversial regulatory decisions. Tolerance of vague substantive standards for delegations fosters this tendency.
Possible Explanations for Court’s Current Stance: (i) broad delegations are desirable because they maximize the flexibility of the administrative process; (ii) the Court cannot articulate a workable test with which to implement the non-delegation doctrine; (iii) the court has found alternative methods for striking down broad grants of power (discussed immediately below).
D.                Construction to Save a Delegation
In modern cases, the Court controls the scope of agencies’ powers by looking not only for an intelligible principle, but also to the total system of controls, both substantive and procedural, that limit agency power. Court’s inquiry: Does the statutory scheme, taken as a whole, fulfill the fundamental objective of the non-delegation doctrine—assuring adequate control and accountability in the exercise of official power. This is consistent with the principle that a court should construe a statute to avoid constitutional difficulties. 
Meat Cutters (DC Cir. 1971) – broad grant of discretion to President to set limits on wages and prices throughout the national economy. Court upholds statute although the text gave little if any direction, on the grounds that it requires the President to be “fair and equitable”; Court reviews legislative history and previous price control programs to give content to statutory provisions. Court emphasizes that Congress will closely monitor it, and that judicial review is available under the APA. Principle: Validity of a delegation can rest on the overall system of controls that a court can find in the regulatory framework.
Tools of Interpretation Used to Limit Delegated Powers Without Invoking NDD:
Implying Substantive Limitations: courts will adopt a narrow view of an agency’s powers, intimating that a broad view would violate NDD.
Benzene – Stevens finds the statute is not unconstitutionally vague, instead finding that administrative rule was flawed because agency had not determined that the rule would cure a “significant risk” in the workplace, which the statute required.
American Trucking – Court defines limitations of Clean Air Act, reading the statute to require EPA standards to go no further than “necessary,” limiting the rulemaking power of EPA. Court also indicates that an Agency cannot cure the lack of an intelligible principle by voluntarily limiting its authority.
Procedural Safeguards: the availability of judicial review can help sustain a delegation.
Meat Cutters (DC Cir) – presumed availability of judicial review under APA ensured that administrative standards could be tested for rationality and compliance with congressional intent; agency’s consistency in application of rules could be checked.
Panama Refining & Schechter – Court places emphasis on fact that statutes did not require President to use fair and open administrative procedures and explain his decisions clearly.
Danger involved with Court’s interpretation tools – Substitution of judicial for executive lawmaking does not encourage Congress to take responsibility for major policy choices; it replaces one unelected decision-maker for another.
II.                Political Controls Over Agency Action
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