Law 17

Scope of Administrative Agency Power Rulemaking Notice: Publication of the Proposed Rule Federal Register A daily publication distributed by the federal government (found in major libraries) primarily used to communicate proposed agency rules, final agency regulations, and other administrative agency or executive branch announcements, such as executive orders.

After research and study, -the agency drafts a proposed rule that purports to achieve one or more objectives set out in the enabling statute. The APA requires that notice of proposed rulemaking be published in the Federal Register and that the notice must include "actual terms, substance and description" of the proposed rule.' -In theory, this requirement puts parties that have some stake in the rule on notice that the rule will become law unless the regulatory agency is persuaded otherwise or a court challenge is brought. Agencies are also required to publicly disclose any studies, reports, data, or other pertinent material that the agency relied upon in creating the proposed rule.

Sources of Administrative Law Enabling Statutes

Congress will sometimes choose to create a new administrative agency to carry out the details of macro objectives set by the law. -When Congress wishes to establish an administrative agency, it passes a federal law called an enabling statute. -Enabling statutes are important because they are the source of an agency's authority and establish the agency's scope and jurisdiction over certain matters. For example, -1970 Congress passed the Occupational Safety and Health Act -established the Occupational Safety and Health Administration (OSHA) -set this agency's mission as the prevention of workplace injuries and the assurance of safe working conditions for employees. -The enabling act portion of the law placed OSHA under the authority of the Department of Labor and provided for the jurisdiction necessary to study and develop workplace safety regulations -in addition to establishing the agency's authority to investigate, enforce, and adjudicate matters involving those regulations. -Enabling acts are also used by Congress to charge an agency with certain additional responsibilities or to provide additional authority for the agency in a particular area of need.

Primary Functions of Administrative Agencies Policymaking

responsibility of making policy that is consistent with the implementation of federal law. -When Congress passes a piece of legislation, it is often crafted in broad strokes that may include findings of fact and/or objectives of the law. -However, the practical aspects of implementing the laws often require more complex and detailed policies. Administrative agencies are frequently charged by Congress to study potential solutions to a problem and then to exercise a legislative function -by creating legally enforceable rules, known as administrative regulations, that purport to satisfy Congress's will by filling in the details of the statute. -This policymaking function is known as rulemaking. Administrative agencies also use a system of adjudicatory bodies established within the administrative agency to decide cases that involve an alleged violation of the agency's rules. -These adjudicatory bodies are staffed with administrative law judges who are actually employees of the particular regulatory body. -This judicial function is known as adjudication.

Scope of Administrative Agency Power

Administrative agencies are often granted broad powers by Congress to accomplish objectives set out in an enabling statute. These powers include policymaking through rulemaking: enforcement, licensing, and inspection; and adjudication.

Limits on Administrative Agencies Executive Branch

From a structural perspective, -administrative agencies are extensions of the executive branch's authority to carry out the legislative mandated -the Supreme Court has acknowledged that the president of the United States has some inherent general right to exercise power over administrative agencies in a variety of ways. Although this inherent power is notoriously vague, from an administrative law perspective, -the president's power is derived from the Appointments Clause -and from direct power through executive orders and, to a lesser degree, through budgetary control.

Scope of Administrative Agency Power Enforcement, Licensing, and Inspection For example, -suppose MillCo operates several mills that are subject to a hypothetical enabling statute called the Mill Control Act (MCA). -The MCA provides that all mills must be maintained in a certain way and that the administrative agency with jurisdiction over the CA should promulgate rules that include monthly inspections to ensure compliance. -Any inspections of MillCo's facilities pursuant to the rule would generally not require a warrant because MillCo qualifies as a pervasively regulated business as defined in the MCA

In terms of enforcement, -U.S. Supreme Court has ruled that agencies have broad discretion as to when and whom to regulate. -This authority, known as prosecutorial discretion, has been held as practically unreviewable by the judiciary. -While enabling statutes can sometimes narrow the agency's authority, courts are still highly deferential to an agency's decision on when and how to enforce its regulations. -Absent a showing that the agency engaged in a patent abuse of discretion in enforcement, parties challenging administrative agency actions have a substantial obstacle to overcome in order to justify judicial interference. Agencies have a separate division (apart from rulemaking) that carries out enforcement responsibilities through the use of investigators and the agency's Office of General Counsel. Administrative agencies also regulate and administer laws through licensing. -Agencies are frequently delegated the statutory power to issue, renew, suspend, or revoke a license to conduct a certain business. -Once a company is licensed, agency may impose fines or restrictions upon the licensee for any violation of agency regulations. = high-profile examples of an agency that regulates through licensing is the Federal Communications Commission (FCC), ==which issues licenses for use of broadcast frequencies. -Administrative agencies at the state level often issue occupational licenses and regulate professionals such as attorneys and physicians, as well as occupations such as those of hairstylists and contractors. Some agencies also monitor compliance with administrative regulations by conducting inspections of businesses and individuals within their jurisdiction. -Administrative agencies are covered from government agents are restricted from engaging in unreasonable searches without a search warrant. and ordinarily an agency must secure an administrative warrant before government agents may enter and inspect a business to monitor compliance with an administrative regulation. =However, certain businesses are classified as pervasively regulated, and, the Supreme Court has fashioned an exception to the warrant requirement that covers situations in which the agency conducts regularly scheduled inspections pursuant to a rule. Even in cases where courts have held that administrative agencies are required to obtain an administrative warrant to conduct an inspection of a business -the Supreme Court has held that agencies are subject to a lower standard of probable cause in obtaining a warrant than the standard that must be met by the government in obtaining a criminal warrant. Also within the agencies' enforcement powers is the right to require businesses subject to the agency's jurisdiction to (1) keep certain records for inspection (2) turn over relevant documents that may be useful in determining compliance with a particular rule (3) request statements or other information from the business's principals or managers.

Scope of Administrative Agency Power Rulemaking

Administrative agencies are charged with developing rules designed to facilitate the federal government's administration of the law and programs as set down in federal statutes. The rulemaking process is set out in the Administrative Procedures Act (APA) -is supplemented by the enabling statutes passed by Congress. In practice, -many of an agency's rulemaking duties are carried out through informal rulemaking procedures that are permitted under the basic structure of the APA. informal rulemaking -actually involves a procedure set down in the APA that is centered on the concepts of notice, public comment, publication of a final rule, and the opportunity to challenge a rule in court. Formal rulemaking -is used only when Congress has specifically indicated in the enabling statute that the agency rules must be made "on the record after a hearing." =the agency is required to engage in an extensive hearing process outlined in the APA to develop the rules. -Formal rulemaking is very cumbersome and rarely used.

Primary Functions of Administrative Agencies

Administrative agencies have a wide range of functions related to the formation, implementation, and enforcement of regulations intended to administer a federal law. Although the agencies are primarily thought of as part of the executive branch and, therefore, exercise executive powers to enforce federal laws related to a particular agency's jurisdictional expertise -they also exercise important legislative and judicial functions as well.

Sources of Administrative Law

Administrative law is not thought of as a separate body of statutes that govern administrative agencies. Rather, administrative law is a combination of four distinct sources of law that operate in tandem: -the U.S. Constitution; -the Administrative Procedures Act (APA); -enabling statutes; -and common law.

Definition, function, and sources of administrative law

Administrative law is the body of law that defines and regulates federal regulatory agencies and limits the exercise of authority by these agencies. Federal regulatory agencies include -bodies that function within a particular executive branch department =(such as the Internal Revenue Service functioning within the Department of the Treasury) -non department agencies =(such as the Environmental Protection Agency). The federal government also has independent agencies -(such as the Securities and Exchange Commission) -that have been designated by Congress as independent of the executive branch and do not exist by virtue of the authority of the president or a department. Departments are headed by a cabinet secretary who reports directly to the president. -Department agencies, non department agencies, and independent agencies are either headed by administrators or composed of commissioners and headed by the commission chair. -These department, non department, and independent agencies are collectively referred to as administrative agencies.

Scope of Administrative Agency Power Rulemaking Revision or Final Publication

After the comment period has ended, -the agency may either revise the rule or publish the final rule in the Federal Register. -If the agency revises the rule between the time that it was originally proposed and the time that it is published as final, there is no legal obligation to provide an additional comment period. -practically, agencies publishing controversial proposed rules may opt for a second comment period, but there is no legal mandate to do so. -One exception occurs when the agency's revised rule is a substantial or material alteration of the originally proposed rule. -Courts have given agencies broad latitude in publishing a revised final rule without an additional comment period so long as the revisions are a logical outgrowth of the originally proposed rule. -Revisions that stay within the original scope of the proposed rule do not trigger the requirement of a second comment period. If the agency's view has not been swayed during the comment period, the agency will publish the proposed rule in the Federal Register as final -When publishing the final rule, the agency is required by the APA to include "a concise general statement of basis and purpose." =This statement is used to meet the legal requirement that the decision be based on reasoned decision making and not made arbitrarily or capriciously. =The agency must also state its conclusions on major issues of fact or policy that were used in its decision making when issuing the final rule. =Agencies also typically include an effective date in the final rule as well. -Once it is in effect, the rule is called a regulation and is published in the Code of Federal Regulations (CFR). In 1990, Congress passed the Negotiated Rulemaking Act, -provides an alternative to normal rulemaking policies in cases where it is possible that various cooperating parties could ultimately reach an agreement on the negotiated proposed rule. =The law provides guidelines for administrative agencies to engage in a formal negotiation procedure intended to draft rules that have the support of affected parties even prior to publication. =The negotiations are conducted through committees composed of representatives from the agency and parties that have an interest in the rule. =However, the act does not relieve the agency of the responsibility to properly publish and establish a comment period for the negotiated proposed rule. =Nor does the act require that the agency end up actually publishing the negotiated rule instead of an agency-made rule.

Scope of Administrative Agency Power Rulemaking Judicial Challenges Arbitrary and Capricious Failure to exercise honest judgment instead of reasoned consideration of all relevant factors.

After the final rule is published, -the APA allows adversely affected parties to challenge the final rule in court." Courts apply the arbitrary and capricious standard when reviewing a final rule. -That is, for the rule to pass judicial muster, the evidence must show that the agency made its final decision based on a consideration of relevant factors without any clear errors of judgment and that its process was consistent with the APA procedural requirements. The right to judicial review of final rules is a relatively narrow one, and courts give great deference to agency authority in the area of rulemaking. Judicial review as a limit on non-rulemaking agency action and authority is discussed in the next section.

Limits on Administrative Agencies Congress

Although the U.S. Supreme Court narrowed congressional review of agency actions in the famous 1983 case of INS v. Chadha, -Congress still retains significant power to influence, amend, or void actions of an administrative agency. For example, -Congress may exercise its constitutionally granted power of the purse over government funding of particular agencies, -or it may simply enact legislation that restricts an agency's authority or pass a new law to overrule an administrative regulation. In 1996, Congress amended the APA' to restore its own authority to cancel an agency's final rule if (1) both houses agree, (2) they pass a resolution to overrule within 60 days, (3) the overruling resolution is presented to the president. Congress also has oversight over administrative agencies by virtue of the Senate's power of advice and consent -in the appointment of certain high-ranking agency officers. -Although Congress may not appoint administrative officials -it still wields broad influence over appointments by virtue of the political realities involved in agency-head selection. Ultimately, Congress has the power to remove an administrative agency head via impeachment by the House of Representatives and removal by the Senate.

Limits on Administrative Agencies

Although the powers delegated to administrative agencies are broad, -it is important to remember that all administrative agencies, including independent agencies, are limited in their authority by the three-part system of the federal government. The legislative, executive, and judicial branches all have various means of power that limit the authority of administrative agencies.

Limits on Administrative Agencies Judicial Review Statutory Interpretation by Agencies

Because Congress uses very broad objectives when it passes an enabling act and other laws -administrative agencies must sometimes interpret an ambiguous statute in order to carry out their duties or take administrative action. In 1984, the Supreme Court adopted the Chevron test as the framework to analyze the validity of administrative agency statutory interpretation and action. -First, courts look to the language of the statutory authority given to the agency by Congress. -If the agency's interpretations or actions conflict with the plain-language meaning of the statute, then a court may hold that the agency's interpretation or actions were unlawful. -If, however, the statute is silent or ambiguous on the agency's authority, the court applies the arbitrary and capricious standard to determine whether the agency's actions were lawful. A heightened standard, known as the substantial evidence test, applies only in a relatively small number of cases where the formal rulemaking process has been required by the enabling act.

Public Accountability

Because administrative agencies are granted broad powers and discretion, -Congress has developed several safeguards to make agencies accountable to the public and to make their work as transparent as possible. This is accomplished through statutorily authorized citizen suits as well as mandatory-disclosure and open-meeting laws

Scope of Administrative Agency Power Rulemaking Agency Study and Research

Depending on the mandates in the enabling statute, -the agency begins to study and research the various alternatives for achieving the goals set by Congress. In some cases, -such as in environmental regulation, -much of the study and research function is performed by government scientists or outside contractor experts who provide data and conclusions to regulatory policymakers in the agency. In addition to working with scientists, outside experts, and policymakers, -regulatory agencies also typically employ a significant number of attorneys who ensure that the rulemaking process is compliant with various sources of administrative law. Agencies may also have separate divisions unrelated to rulemaking for enforcement, licensing, and other functions.

Limits on Administrative Agencies Executive Branch Direct Power

For the last several decades, -presidents have exercised direct power over administrative agencies to accomplish the president's public policy objectives. For example, in 1982, - in response to what President Reagan perceived as a regulatory system that was so burdensome on certain industries that it impacted the industrial output of the country, -he issued an executive order requiring that all federal administrative agencies submit to cost-benefit analysis along with any proposed regulation as part of a mandatory review process by the Office of Management and Budget (OMB). -OMB was assigned to encourage agencies to be as cost-conscious as possible when imposing regulatory schemes on certain industries. -This executive order is thought of as direct power over the agencies because the OMB reports directly to the president.

Administrative Law at the State Level

In addition to federal agencies, -business owners and managers should also expect to encounter state administrative agencies. Although our discussion has focused primarily on federal administrative law, -state agencies also have broad executive, legislative, and adjudication discretion in matters of state administrative law. Indeed, many state agencies exist to accomplish substantially the same objectives as those of federal agencies, -but they operate at a comparatively micro level, -with state administrative law more tailored to the needs of the particular state. for example, -California supplements existing federal air pollution regulations with additional state regulations designed to reduce smog problems in its major cities. States often have their own versions of federal agencies. For example, -all states have a department of revenue (or some similarly named agency) that is the state's version of the Internal Revenue Service. -States frequently have agencies devoted to the regulation of parties within the state's borders in regard to the sale of securities (selling a business entity's stock to the public), protection of the environment, regulation of banking and insurance companies, workplace safety, consumer protection, and labor and employee antidiscrimination regulations. Federal and state agencies also share information and work together on joint operations. -State administrative law is very similar to the federal scheme in terms of how regulations are developed, implemented, and enforced.

Public Accountability Private Citizen Suits

In addition to limits imposed on federal administrative agencies by the executive, legislative, and judicial branches, -many enabling statutes contain provisions authorizing any member of the public at large who is directly affected by a particular agency action (or inaction) -to bring a lawsuit against violators of a particular regulation and/or the administrative agency itself for failing to fulfill a duty imposed by statute. These suits are called citizen suits and are particularly prevalent in statutes related to protection of the environment. Asbestos is a human-made material that was commonly used to make ceiling and floor tiles until the 1980s, when governmental health agencies determined that asbestos dust was linked to cancer. -As a practical matter, organized activist groups such as the Sierra Club or the Natural Resources Defense Council (NRDC), in the case of environmental regulation, often file citizen suits. In terms of suits against the government, -it is important to realize that citizen suits cannot be used to attack the substance of a regulation that has been properly promulgated. -Citizen suit provisions may be used only to compel the agency to act in a manner consistent with the enabling act or another federal statute.

Limits on Administrative Agencies Judicial Review Applying the Arbitrary and Capricious Standard

In order to meet the judicial review requirements, -agencies must provide evidence that a reasoned decision-making process was used rather than an action that was arbitrary and capricious. -This standard applies to all agency actions, including rulemaking, adjudication, enforcement, inspection, and licensing. Arbitrariness and capriciousness are found -when the agency has taken action that is not based on a consideration of relevant factors, including viable alternatives available to the regulatory agency, or is a result of a clear error of judgment by the agency. -The APA specifically requires that courts review only the information that the agency had available to it at the time it took the action in question. Although the power of courts to set aside an administrative agency's action is clear, -courts have traditionally been sparing in the use of this power. -The U.S. Supreme Court has consistently held that judicial deference to administrative agencies is an important part of administrative law and that a court should not substitute its judgment for that of the agency. The Court provided guidance for lower courts in applying the arbitrary and capricious standard in -Motor Vehicle Manufacturing Association v. State Farm Mutual Automobile Association. -In that case, the Court ruled that agency action was arbitrary and capricious if the agency (1) relied on factors that Congress had not intended it to consider, (2) failed to consider an important aspect of the problem, (3) offered an explanation for its decision that ran counter to the evidence before the agency, or(4) offered an explanation that was so implausible that it could not be ascribed to a difference in view or the product of agency expertise. The arbitrary and capricious standard received significant media attention when it was the central issue in a case challenging the Department of Interior's six-month ban on deepwater drilling in the wake of the Deepwater Horizon (BP) oil spill disaster.

Scope of Administrative Agency Power Adjudication

Many (but not all) administrative agencies have authority to adjudicate matters under their jurisdiction. Adjudication is a hearing in which the government and the private party each presents evidence in a quasi-judicial setting. -In most agencies, the presiding officer is an administrative law judge -ALJ who is typically an attorney employed by the agency to adjudicate disputes. Recall from Chapter 2. -that federal adjudicatory powers are constitutionally vested exclusively in federal courts. -However, federal courts have permitted agency adjudication =when it occurs in the context of public rights disputes (a private party dispute with an agency over the agency's action or inaction) =or when two private parties are disputing rights that arise within an area of the agency's jurisdiction."

Primary Functions of Administrative Agencies Investigation and Enforcement

Many administrative agencies also have an agency enforcement division devoted to investigating alleged violations of the agency's administrative regulations and recommending enforcement actions such as fines and other sanctions. Agencies have a wide range of discretion as to when and how they enforce regulations against a violator. Administrative agencies also monitor compliance with regulatory requirements through inspection of the facilities and grounds of business sites under their jurisdiction.

Scope of Administrative Agency Power Rulemaking Public Comment

Once the proposed rule has been published in the Federal Register, -the agency must then give time for the public to comment. =In fact, the APA requires that the affected parties be allowed to participate in the rulemaking through submission of their own research and findings and that the agency make a good faith effort to study anything submitted and to consider the arguments made in the comment period. In cases that impact a particular region of the country, -agencies sometimes choose to meet public comment requirements by holding public hearings at strategic times and locations during the comment period. In practice, -many of the comments and much of the evidence submitted on proposed rules are generally delivered by representatives from, among others, (1) various factions from business and industry (such as the National Manufacturers Association), (2) professional associations that represent large blocks of constituents (such as the National Association of Realtors) (3) public advocacy groups (such as the Natural Resources Defense Council). For example -suppose the Securities and Exchange Commission proposes new rules relating to corporate reporting disclosure requirements for publicly held companies. -The SEC would likely expect various groups representing publicly held companies, as well as the executives of the affected companies, to comment urging the SEC to not make the requirements too burdensome. -On the other hand, the SEC is also likely to receive comments from consumer advocacy and shareholder watchdog groups urging the agency to adopt even stricter disclosure requirements.

Public Accountability Federal Disclosure Statutes

One way that administrative agencies are accountable to the public is through transparency, -which requires public access to informational records held by the government -& disclosures concerning open hearings and other business conducted by federal agencies. Congress provides two primary mechanisms to achieve these transparency objectives: 1. the Freedom of Information Act (FOIA), -which gives the public the right to examine a great many government documents, 2. the Government in the Sunshine Act, -which requires that certain agency meetings be open to the public

Sources of Administrative Law Common Law

Prior to the establishment of the APA, a body of common law that regulated administrative agencies existed. While much of the common law has been codified through the APA. courts sometimes still refer to the common law in applying or interpreting the APA.

Primary Functions of Administrative Agencies Licensing and Permitting

Some administrative agencies also are responsible for licensing and permitting in a wide variety of areas, including licenses for professionals and industries. For example -Securities and Exchange Commission issues licenses to certain individuals involved in the public trading of stocks, -and the Federal Communications Commission licenses television and radio stations. Agencies also issue permits, -such as those issued by the Environmental Protection Agency to control air and water pollution.

Limits on Administrative Agencies Judicial Review

The APA sets various standards of review for cases where administrative agency actions are challenged in a federal court. Of course, courts will set aside any agency action that is inconsistent with the Constitution. -But the APA also authorizes courts to void agency actions if the agency has exceeded its statutory authority or if agency actions have been taken without adhering to the statutorily established procedure.

Sources of Administrative Law Administrative Procedures Act (APA)

The Administrative Procedures Act (APA)' of 1946 is a -federal statute that imposes specific procedural structures and due process requirements on administrative agencies' duties of rulemaking, adjudication, and other agency functions. The APA also provides for the judicial review of agency actions and determinations.

Limits on Administrative Agencies Executive Branch Appointments Clause

The Constitution gives the president the power to appoint "officers of the United States" consistent with the Appointments Clause in Article II. -Although subject to confirmation by the Senate, -the president has the exclusive right to nominate principal officers such as cabinet members or commissioners of independent agencies that report directly to the president. Although not specifically articulated in the Constitution, -the Supreme Court has held that the president also has the power to remove any principal officers at any time with or without cause and without any congressional approval. However, Congress sometimes passes an enablement act with a restriction on the president's power to remove a particular officer of the government. -Federal courts have held that this limiting type of statutory restriction is constitutional so long as the restrictions do not impair the president's ability to carry out his constitutional duty. In fact Congress has designated certain agencies, such as the Securities and Exchange Commission (SEC) and the Federal Trade Commission (FTC), -as independent of the president's direct powers, -and the heads and commissioners of independent agencies may be removed only for good cause (such as corruption) and not for mere differences in policy views between the agency and the president

Public Accountability Federal Disclosure Statutes Freedom of Information Act (FOIA)

The Freedom of Information Act (FOIA) -passed by Congress in 1966 (and expanded by amendments in 1974) -to open up certain agency records for public inspection. Fundamentally, -the FOIA requires agencies to publish certain matters and, upon the request of an individual or agency (such as a media outlet), to allow public inspection of all other records created or obtained by the agency in the course of doing its work. I n order to ensure agency cooperation in complying with the FOIA, -the law allows private parties to sue the agency if the records are wrongfully withheld. -However, the FOIA also contains nine separate categories of exceptions designed to protect legitimate interests. =The most commonly excluded records are documents that contain (1) sensitive national defense or foreign policy information; (2) agency personnel matters or agency policies on purely administrative issues, such as sched-ules, performance reviews, records related to personnel, medical files, and other private matters; (3) trade secrets and privileged commercial information, such as a secret process or device submitted by a business to the agency. For example, -assume that Product Co applies to the Environmental Protection Agency for a permit to discharge waste products into a stream after they are treated for pollution by a secret cleaning process designed by Product Co's scientists. -This process would likely need to be identified in Product Co's permit application and, thus, would be within the ambit of the FOIA. -However, it would fall into the trade secret exception and would be protected from disclosure to the public at large.

Public Accountability Federal Disclosure Statutes Government in the Sunshine Act

The Government in the Sunshine Act requires that agencies announce their meetings at least one week in advance and open the meetings to the public unless a meeting falls within one of the Sunshine Act exceptions. However, the law does not apply to meetings that are purely consultative in character or that concern investigatory or adjudication matters

Scope of Administrative Agency Power Rulemaking Protection of Small Business Owners

The Regulatory Flexibility Act (RFA) of 1980, =as amended by the Small Business Regulatory Enforcement Fairness Act (SBREFA) of 1996, -requires agencies to ask for and consider regulatory proposals that address the size of the businesses or other organizations subject to regulation. When a proposed regulation will have a significant economic impact on a substantial number of small businesses, -the RFA requires, among other things, that agencies analyze and take into consideration small business concerns. -Under the RFA, when an agency issues a rule that will have a significant economic impact on a substantial number of small entities -agency must provide small businesses the opportunity to participate in the rule-making. Providing the opportunity to participate may include soliciting and receiving comments from small businesses. -The participation of small businesses helps agencies fulfill their statutory objectives while reducing, as much as possible, the burden on small businesses.

Sources of Administrative Law U.S. Constitution

The U.S. Constitution places limits on the -type of powers that agencies may exercise -the methods that agencies may employ in carrying out their duties. Examples of provisions of the Constitution that limit agency powers include -the Due Process Clause; =doctrines derived from the principle of separation of powers, including the nondelegation doctrine; -Fourth Amendment protections against certain warrantless searches by agency personnel.

Scope of Administrative Agency Power Adjudication Appeals

The losing party in an ALJ case generally has an automatic appeal to the administrative head of the agency, -who may overturn or affirm the ALS's ruling. An adverse decision from the agency may also be challenged in a federal trial court.

Primary Functions of Administrative Agencies Distribution of Federal Statutory Benefits to the Public

When Congress confers a benefit to the citizenry at large, administrative agencies are the portal used by the law to actually distribute those benefits. Agencies are involved in the application process and distribute benefits according to law. -These benefits include loan guarantees for students, medical care for the poor and elderly, compensation for workers laid off by their employers, and many other federal programs. For example, -the Social Security Administration is responsible for distributing retirement and medical benefits to eligible citizens.

CONCEPT SUMMARY Scope of Administrative Agency Power

• Administrative agencies have broad powers, including rulemaking, enforcement, licensing, and adjudication. • Agencies develop rules to be used in facilitating the government's administration of the law. • The rulemaking process involves agency research, publication of a proposed rule in the Federal Register, a period for public comment on the proposed rule, and either revising the rule for additional comment or publishing a finalized rule. • Agencies must use a reasoned decision-making process that is not arbitrary or capricious. • After a final rule is published, the APA allows adversely affected parties to challenge the rule in court. However, courts give great deference to the agency's decisions. • Agencies have prosecutorial discretion in deciding when and whom to regulate. • Administrative agencies also regulate and administer laws through the licensing process, in which they issue, renew, suspend, or revoke a license to conduct certain types of business. • Some agencies also monitor compliance with regulation by conducting inspections of businesses and individuals within their jurisdiction. • Administrative agencies have the authority to adjudicate matters under their jurisdiction by holding a hearing between the government and private parties in front of an administrative law judge.