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Administrative Law
Wayne State University Law School
Hall, Noah Donald

Administrative Procedure Act – defines procedural rights of persons outside of government and structures manner in which persons inside government make decisions
 
2 Facets of Admin Law:
1) law that governs agencies
2) law that agency makes
 
APA §551(1) – defines “Agency” – “each authority of the Government of the United States, whether or not it is within or subject to review by another agency”, w/ specific exceptions
 
Types of Agencies
Departments:
–          agencies, have the highest status – have various sub-entities w/ specialized responsibilities
–          headed by a Secretary (except DOJ), appointed by Pres. w/ advice & consent of Senate – President can fire them for any reason
–          all are executive agencies
Subagencies:
–          Departments contain host of sub-entities, each is an agency
–          Heads appointed by Pres. w/ Senate consent, Pres. can fire for any reason
 
Independent Agencies:
–          Headed by multi-member groups that reach decisions by majority vote
–          Usually can only be removed for cause (Pres. can’t remove b/c of political disagreement)
–          Serve for a term of years, usually staggered terms
–          Usually no more than a simple majority can come from a single party
 
Executive Agencies:
–          Headed by single person
–          Serve @ the pleasure of the President, almost always same party
–          Serve until they resign or are fired
 
Functions of Agencies –
–          Regulate private conduct – regulatory agencies (consumer protection, environmental regulation)
o   Justification: regulation used to conform market outcomes to social values, also to make market more efficient (i.e. adequate consumer info)
–          Administer entitlements programs – Social Security, Medicare, Medicaid, welfare – focus on dispensing federal & state funds for specified purposes to proper recipients
o   Can be subsidiary or related regulatory effect through qualifications, etc.
–          Everything else – IRS, Immigration, Customs, Department of Defense, etc. – still have impacts on welfare of persons & companies
 
3 Types of Agency Action =
(1) Rulemaking (legislative action),
–          Agency can specify further regulations in addition to rules created in its statutory mandate (filling in the gaps) – authority limited to powers specified in mandate
–          Initially published in Federal Register, annually in CFR
–          Subject to judicial review, agency has to follow procedural requirements
(2) Adjudication (judicial function),
–          Makes decisions concerning how a law or regulation applies in a specific circumstance
–          Has same force of law as if made by a court, but power limited to functions specified in enabling act
–          Subject to judicial review, agency has to follow procedural requirements
(3) Investigation (executive function)
–          Subpoena power most common tool
–          Legislature can also authorize to compel regulated entities to file periodic reports
–          Also can authorize agency to inspect premises of regulated entity to determine if it’s in compliance w/ regs
–          These powers also subject to judicial review
 
I. Rulemaking
 
Definition: §551(5) the agency process for formulating, amending, or repealing a rule
–          §551(4) – rule: an agency statement of future effect designed to implement, interpret or prescribe law or policy
–          Key: statement of future effect – binding only concerning future conduct
 
A. Initiation
 
-Process begins when agency considers whether to propose a rule
 
1. Sources of proposed regulations:
–          Legislation requiring specific regulations (often by particular time or upon occurrence of certain events, or just generally requiring rules to protect safety, in the public interest, etc.)
–          Rules often begin with staff recommendations (bottom up approach)
–          Can originate in Whitehouse or Congress (top-down approach)
–          Agency may propose to avoid critical legislative investigation prompted by complaints from statutory beneficiaries
–          The public – lobbyists acting indirectly through legislators or executive officials, or at the staff level
–          Rulemaking petitions – §553(e) – each agency shall give an interested person the right to petition for issuance, amendment, or repeal of a rule
 
à Once agency decides to initiate a rule, must publish in Regulatory Agenda
 
2. Lobbying – have to try to argue that what you want it to do best coincides w/ its interests, comports w/ the policy – best to input data and argume

ication à whether just a question of law (agency authority to do something), or b/c agency’s view is different from petitioner’s (agency decided it wasn’t important enough)
–          Very Narrow Standard of Review for Agency Denial of Petitions: adequate explanation + some basis for facts in record = deference
o   Arkansas P&L  v Interstate Commerce Commission [69] – ICC denied rulemaking petition, said it would be unnecessarily cumbersome and current procedures were adequate – Court: Deferred to ICC’s decision, ICC explained itself & decision was reasonable – generally, courts will only compel agency to institute rulemaking proceedings in extremely rare instances à review limited to ensuring agency has adequately explained facts & policy concerns, and that facts have some basis in the record
o   Northern Spotted Owl v Hodel [70] – EPA denied petition, decided not to list owl as endangered – Court: EPA’s action reviewed under “arbitrary & capricious” standard, still in-depth review, but narrow standard that presumes valid – arbitrary & capricious if agency has failed to articulate satisfactory explanation for its action including rational connection between the facts found and the choice made – agency must set forth clearly the grounds on which it acted
§ EPA did not provide any analysis (no explanation of grounds for action), none of the expert analyses supported its opinion, agency disregarded all the expert opinions, just asserted its expertise as support (no rational connection btw. facts found & choice made) – Court found that it didn’t set forth the grounds for its decision\
§ Remedy: remanded to agency to provide analysis for its decision w/in 90 days
–          Courts VERY UNLIKELY to order agency to institute a rulemaking proceeding – even if they do find decision arbitrary, will remand to agency to provide a better explanation