Introduction:The Role of Agencies

Three Sources of the Law• Legislative • Judicial• Executive

– President– Cabinet– Administrative Agencies

• are established by legislatures, agencies and are usually organized under the executive branch of government, often associated with a Cabinet position

• conduct legislative, executive, and judicial types of activities

• exist on both federal and state levels (We will use the federal system as the paradigm for state agencies.)

• Examples of executive branch agencies are the– Environmental Protection Agency– Department of Transportation– Federal Reserve Board– Department of Agriculture– United States Postal Service– Department of Veterans’ Affairs– Federal Aviation Administration

• Because of the scope of Congressional delegation of authority, each agency is unique in its structure, its personnel, and the nature of its regulations.

• Unless talking about a specific agency, administrative agencies’ regulations and decisions must be discussed in broad generalizations.

Independent Administrative Agencies: The Fourth Branch of Government?

• There are also agencies that are created by Congress as part of the executive branch but are not under the direct control of the president.

• Many of these are independent regulatory commissions.

• The president appoints, but cannot remove commissioners except for causes specified under the enabling statute.

• These agencies are often called the “headless fourth branch” of government.

• Examples of regulatory commissions are the – Civil Aeronautics Board– Equal Employment Opportunity Commission– Federal Trade Commission– National Labor Relations Board– Nuclear Regulatory Commission – Securities and Exchange Commission– Federal Energy Regulatory Commission– Federal Deposit Insurance Corporation– Federal Communications Commission

An administrative agency may be called a

– Board• National Labor Relations Board

– Commission• Federal Communications Commission

– Corporation• Federal Deposit Insurance Corporation

– Authority• Tennessee Valley Authority

– Department• Department of Transportation

– Administration• Social Security Administration

– Agency• Environmental Protection Agency

Role of Administrative Agencies

• Legislative: Granted rulemaking authority– Congress delegates authority to promulgate regulations

to administrative agencies• Enact enabling statutes• Establish the scope of agency authority

– Presidential Executive Order may also delegate authority to promulgate regulations to administrative agencies.

• Judicial: Congress may also grant power to hear and settle disputes arising from the regulation or the enabling statute.

• Executive: Congress may also grant power to investigate and prosecute violators of regulations.

Role of Administrative Agencies

The Securities and Exchange Commission is an example of an agency with powers similar to those of all three branches of government

– Legislative: promulgates regulations governing what information must be given to investors.

– Judicial: conducts hearings to determine guilt and mete out punishment to violators of these regulations.

– Executive: enforces these regulations by prosecuting violators by disciplinary actions and stop orders.

Role of Administrative Agencies

Outcomes of agency actions include

– Rules or regulations (the two words are used interchangeably), which have the same effect as statutes

– Licenses, which include permits, certificates, other types of permission

– Advisory opinions, which are authoritative interpretations of statutes and regulation but are not binding

– Orders, which are the final disposition of any agency action, other than rulemaking

– Decisions, which adjudicate controversies arising out of the interpretation of statutes or regulations; they are issued in the same manner as court decisions

STATUTES

• Passed by Congress

• Provide for broad social and economic goals and legal requirements

• Get their power from the Constitution

• Reviewed by courts for constitutionality

• Representative democracy – Congress acts to represent the will of the people

REGULATIONS• Issued by agencies• Get their power from

Congress• Prescribe specific legal

requirements to meet congressional goals

• Reviewed by courts to determine constitutionality, limits of delegated authority, and whether they are arbitrary and capricious

• Participatory democracy – agencies must seek and consider public comment

Comparison of the Roles of Statutes and Regulations

The Process of Promulgating Regulations (Rulemaking)

The initiative behind promulgation of a new regulation or a change in a regulation can originate from many sources, including– legislation that delegates authority– congressional hearings and reports– court orders – Executive Orders and Office of Management and

Budget Circulars– agency acting on its own initiative– emergency situations, technological developments, etc.– political pressures– Federal Advisory Committee recommendations– petitions and informal requests from affected parties

Rulemaking Process

• Regulation is proposed

• Office of Management and Budget reviews under Executive Order 12866

• Proposed rule is published in the Federal Register

• Public comment is invited

• Office of Management and Budget re-reviews regulation

• Final regulation published in the Federal Register

Rulemaking Process• Final regulation published in the Federal Register

– Responds to comment– Amends Code of Federal Regulations– Sets effective date

• 30-day minimum for most regulations• 60-day minimum for major regulations• No minimum for good cause• Agency may delay or withdraw regulation before it

becomes effective • Agency submits regulation to Congress and Government

Accounting Office, which can nullify the regulation• Regulation is placed in Code of Federal Regulations

(CFR)

PublicLaw

(EnablingStatute)

FederalRegister

ProposedRegulation

FederalRegister

Final Regulation

Code ofFederal

Regulations

Congress Agency Agency Agency

ExecutiveOrder

Delegated Authority

CongressionalOversight

JudicialReview

Delegated Authority

Public Comment

President