Williams, D.
Administrative Law
Summer 2011
I. Introduction: The Administrative State, Regulation, and Administrative Law
A. Sources of Law: Constitution, Statutes, Judicial Decisions, Agency Rules
B. Rationale of Regulation: (1) Public Interest expl.- public need; (2) Public Choice- political reasons
1. Rationale is usually tied to market failure (Public Interest):
2. The need to control monopoly power. Example: ICC/RRs.
3. The need to compensate for inadequate information. Examples: SEC, USDA, CSPC, OSHA
4. The need to control externalities. Example: Tragedy of Commons.
5. Collective Action Problems: Defense, Clean Air, Parks, Clean Water (gov’t provide since market can’t produce).
6. Capture theory- interest group ‘capture’ of legislative process for personal benefit (Public Choice)
II. Constitutional Law: Administrative Structure and Functions
A. Introduction: Separation of Powers, Checks and Balances
1. Separation of Powers and Checks and Balances
a. The doctrine against legislative “delegation” of legislative power
2. Anything an agency does must have a warrant in legislative action/rules-Youngstown Sheet & Tube Co. v. Sawyer (beyond presidential power to seize mills)
a. Constitution authorizes exercise of powers to institutions (e.g. administrative agency).
b. Statutes are limited by Constitution.
c. Agencies are limited by Statutes.
3. Concerns:
i. Agency promulgation of rules seems like legislative power of Congress.
ii. Agencies are located under the executive branch of the government. Looks like executive branch is legislating, seems to violate the whole idea of separation of powers.
iii. The branches are not as separate as that idea seems since there is an overlap and sharing of power:
a. President has legislative power – veto.
b. Congress has executive power – must approve presidential appointments.
c. President has say over appointments to judicial branch.
iv. Dealing with this concern – the non-delegation doctrine was developed.
B. Legislative Power and the Non-Delegation Doctrine
AUTHORIZATION:
1. Non-Delegation Doctrine: Congress cannot delegate constitutional legislative power to any institution.
a. Doctrine is a dead since 1935 (last time Sup.ct ruled).
b. Associated with the conservatism period of the New Deal where Court was trying to control President Roosevelt. Since then, Court caved in and there has been an incredible expansion of federal power. Schechter Poultry.
c. Vesting Clause of Article I, Section I à“All legislative power shall be vested in a Congress…”
Since it is all power, any delegation would be inconsistent with the Framers’ choice to only give the power to Congress. See Locke.
2. Why might it be difficult to apply the Non-Delegation Doctrine?
a. Difficulty: Q of whether the degree of power delegated is too much.
i. Might be difficult area to regulate or articulate a regulation bc of CHANGES in industry, consumer desires, technological innovation.
ii. Congress does not have the expertise to regulate the industries effectively- agency had more INDUSTRY COMPETENCE
iii. If courts get really aggressive with non-Delegation doctrine, they might be SUBStituting JUDGEMENT w the judgment of Congress to give discretion to the agency.
iv. When talking about question of degree, Courts have lots of trouble. Balancing tests difficult to apply.
The Benzene Case (1980) Rehnquist’s Dissent: The Delegation Doctrine Still Alive? Concerns :
“First, it ensures that important choices of social policy are made by Congress, the branch of our Government most responsive to the popular will…
Second, the doctrine guarantees that delegation of authority with an “intelligible principle” to guide the exercise …
Third, the doctrine ensures that courts have a ascertainable standards to determine extent of agency discretion”
4. The Progression of the Non-Delegation Doctrine
Unconstitutional because violated the non-delegation doctrine:
a. Panama Refining (1935): “provided literally no guidance for the exercise of discretion.” Unconstitutional because no intelligible principle.
c. Schechter Poultry (1935): NIRA violated the non-delegation doctrine. The NIRA “conferred authority to regulate the entire economy on the basis of no more precise a standard than stimulating the economy by assuring “fair competition.” Quoting Whitman.
e. (The Benzene Case) (1980) àIs Congress prepared to recognize the non-delegation doctrine?
i. Before issuing any standard, the agency must characterize a substance (here Benzene) as “significant effect.” To allow anything to be regulated below what is “significant” would be unconstitutional “sweeping delegation of legislative power.”
Nondelegation doctrine is cleariy dead:
g. Whitman v. American Trucking Associations Inc. (2001): Supreme Court rejects “determinate criterion” test in favor of “intelligible principle” test.
i. Signal to lower courts “In short, we have ‘almost never felt qualified to second-guess Congress regarding the permissible degree of policy judgment that can be left to those executing or applying the law.”
ii. These are VERY strong signals that the open door in the Benzene case is closed. The non-delegation doctrine is dead and if you bring this argument, you will loose.
REVISION:
1. Legislative Amendment
2. Legislative Review
a. Legislative “Veto”
i. Varieties:
1. One-house (violates bicameralism and presentment)
2. Two-house (satisfies bicameralism, violates presentment)
3. Committee (or sub-committee) (doesn’t even require the authority of one house)
ii. Legislative “veto” an Effective Response to the Delegation problem? NO.
A legislative veto is unconstitutional because it violates Art. I. § 7 bicameralism and presentment process requirements. One-house legislative veto violates the separation of powers—INS v. Chadha
* Bicameralism requirement- regulation by both houses (house of representatives and the senate)
* Presentment requirement- that a legislation be presented to the president for approval or veto
If a court finds a statute’s “legislative-veto” provision is void, it may be severable from the remainder of the statute- INS v. Chadha.
* Important because about 200 statutes contained such clauses & don’t want to find them all invalid.
3. Congressional Review Act:
a. Requires agencies to submit all rules to Congress
b. If the rule is deemed to be a “major” rule, it is effective only if Congress does not pass a resolution of disapproval within 60 days and the President signs the joint resolution- 5 U.S.C. § 801
c. Since the legislation meets bicameralism and presentment, it is not subject to the constitutional objections raised in Chadha.
d. Used successfully once (OSHA’s ergonomics rule)
4. “Sunset” Provisions:
a. The statute creating the agency authority expires on a date certain, forcing congressional reconsideration of regulatory program and agency’s place in it (reconsider existing priorities).
b. Used sparingly by Congress
APPROPRIATION:
1. General Appropriation: example-a lump-sum to an agency to be used as agency deems fit
2. Specific Appropriation: specifies what the money would be used for.
3.
stitutional.
a. **Always look at HOW the administrator used his/her power
· Quasi-Legislative or Quasi-Judicial Officers may be removed by Pres. only with procedures consistent with statutory conditions enacted by Congress (there might be “good cause” for restricting removal authority of Pres)- Humphrey’s Executor v. U.S
· Quasi-judicial power can be a basis for removal, but must be removed only for good cause—Weiner v. U.S (functional approach of keeping separation of powers)
· President may not be able to remove based on a decision that is particular to the office which the officer is a head
· Legislature cannot assume an “active role” in supervising/removing official with executive duties- Bowsher v. Synar
o Case does not overrule the idea of “good cause” restriction adopted in Humphrey’s Exec.
o Good cause req. only unconstitutional if it “impedes the President’s ability to perform his constitutional duty”
· Morrison v. Olsen: Congressional limits on removal of purely executive officer is upheld.
o Limit of removal is constitutional because it doesn’t jeopardize the President’s ability to perform his constitutional functions.
o Executive ability to remove quasi-judicial functions is not too much to prevent President’s ability to perform constitutional functions. There is some limit here, but it is permissible.
· Resolving the Cases:
o In Morrison, Congress is not involved in removal. In Bowher and Chada, Congress was involved. That’s the easy way to reconcile these cases.
· Free Enterprise Fund v. Public Company Accounting Oversight Board
o Facts: “Dual For-Cause Limitations”—SEC Commisioners may be removed by President only for “good cause” & PCAOB member may be removed by SEC only for “good cause”
o Holding: Dual for-cause limitation is unconstitutional bc it removes Pres’ power to make a “good cause” determination, prevents the president from “faithfully executing the laws,” and prevents the President from holding SEC accountable for the Board’s conduct
o Severability is fine.
vi. Comment on Independent Agencies:
i. An independent agency does not serve at the pleasure of the president. Thus, there is restriction on the removal authority of the President.
ii. Independent Counsel may be removed in 2 ways:
a. Purely an executive function
b. Removal by AG for “good cause.” (And it is inconsequential if it is the AG that takes action bc the Pres decides who is the AG.)
e. President’s Supervisory Powers
a. May the President direct the way in which officers exercise authority?
1. Congress may assign duties to Officers that are not subject to Presidential direction- Kendall v. United States
2. President may act only if own consitutional authority trumps Congress’s contrary preference- Youngstown Sheet & Tube v. Sawyer
b. Presidential Oversight of Agency Rulemaking
1. Centralized review of significant regulatory actions/activity and to vest this review in the Office of the Management and Budget (OMB) through its interior Office of Information and Regulatory Affirs (OIRA).
c. Subdelegation- not that important anymore
