Checks and Balances: June 2020

The Checks and Balances Letter delivers news and information from Ballotpedia’s Administrative State Project, including pivotal actions at the federal and state levels related to the separation of powers, due process and the rule of law.

This edition:

In this month’s edition of Checks and Balances, we review the potential implications of the coronavirus pandemic for the repeal of agency rules under the Congressional Review Act; President Donald Trump’s (R) executive order concerning procedural rights in administrative adjudication; a new quorum at the Federal Election Commission; and an order from the Pipeline and Hazardous Materials Safety Administration that highlights the role of federal agency in preemption decisions.

At the state level, we review a Wisconsin Supreme Court decision that struck down the state’s stay-at-home order, litigation across the country challenging executive orders that limit religious gatherings in response to the coronavirus pandemic, and a lawsuit in Maine that questions whether voters can overturn state agency orders. 

We also highlight a review of administrative law scholar Richard Epstein’s new book The Dubious Morality of Modern Administrative Law as well as new findings from Ballotpedia’s survey of all 50 state constitutions and administrative procedure acts regarding the executive power to remove agency officials. As always, we wrap up with our Regulatory Tally, which features information about the 192 proposed rules and 236 final rules added to the Federal Register in May and OIRA’s regulatory review activity.

In Washington

Coronavirus could allow next Congress to block more administration regulations

  • What’s the story? Canceled congressional workdays due to the coronavirus pandemic could result in an expanded window of opportunity under the Congressional Review Act (CRA) to challenge agency actions taken in the remaining months of 2020. 
  • Under the CRA, a new Congress has 75 legislative days to overturn agency rules issued in the last 60 days of a prior session of Congress. Since the coronavirus pandemic led congressional leaders to cancel business on several days when Congress would have otherwise been in session, attorney Robert Mangas argued in the National Law Review that the beginning of the final 60 days may have already passed.
  • The president must sign CRA resolutions for them to go into effect. If President Donald Trump (R) wins re-election, opponents of agency actions taken this year would have to gather enough votes to override his veto. However, if another candidate becomes president in 2021, rules made by agencies through most of 2020 could be vulnerable under the CRA.
  • Administrative law scholars refer to rules adopted at the end of presidential administrations as midnight rules. Since 1948, agencies have made rules at a higher rate in the time between election day in November and inauguration day the following January compared with other periods. 
  • In the first four months of the Trump administration, President Trump signed 14 CRA resolutions from Congress that overturned rules issued near the end of Barack Obama’s (D) presidency.
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Trump’s pandemic response executive order aims to protect procedural rights in agency adjudication

  • What’s the story? President Donald Trump (R) on May 19 issued Executive Order 13924 aimed at spurring economic recovery from the coronavirus pandemic. The order also contains provisions aimed at safeguarding procedural rights and ensuring fairness in agency adjudication and enforcement.
  • The order directs agency leaders to determine whether regulations modified or waived during the pandemic should be repealed permanently. More than 600 regulations could be affected, according to news reports. 
  • The order also puts forth what it deems a set of “principles of fairness in administrative enforcement and adjudication” and directs agencies to comply with the principles where appropriate as part of their pandemic response efforts. The principles include broad standards of promptness, fairness, and transparency in adjudication and enforcement proceedings as well as more specific procedural due process protections, such as requiring that adjudication be free from government coercion and that agency adjudicators be independent of enforcement staff. 
  • “[President Trump] knows that what will jump-start the economy is not Big Government, but the American people,” said White House Office of Information and Regulatory Affairs Administrator Paul Ray in The Washington Times. “That’s why this president is fighting the economic emergency by returning even more liberty to the people.”
  • Some critics of the order, including U.S. Representative Bonnie Watson Coleman (D-N.J.), claimed that the deregulatory efforts would put workers, consumers, and the environment at risk. Others, including Project on Government Oversight senior policy analyst Sean Moulton, expressed concern that agencies would respond to the principles of fairness by suspending regulatory enforcement altogether.
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FEC regains quorum to enforce campaign finance laws

  • What’s the story? The Federal Election Commission’s (FEC) nearly nine-month period without a functioning quorum came to a close on May 19 when the United States Senate voted 49-43 along party lines to confirm Republican attorney Trey Trainor as the commission’s newest member. Trainor’s confirmation created the quorum of members necessary for the FEC to oversee campaign finance disclosures, perform audits, and enforce fundraising violations.
  • The FEC had lacked a quorum since Republican Vice Chairman Matthew Petersen resigned on August 31, 2019. Trainor joins Republican Chairwoman Caroline Hunter, independent Vice Chairman Steven Walther, and Democratic member Ellen Weintraub on the six-member commission.
  • The Federal Election Campaign Act requires a vote of at least four of the FEC’s six members for the commission to undertake a number of key policy duties such as promulgating rules, issuing advisory opinions, and deciding enforcement actions. As a result, all of the commission’s four active members must reach a consensus in order to proceed with substantive actions. 
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Order highlights role of federal agencies in preemption decisions

  • What’s the story? The Pipeline and Hazardous Materials Safety Administration (PHMSA)—the federal agency tasked with regulating the transportation of oil and other hazardous materials—issued an order on May 11 that blocked a Washington state law that would have placed restrictions on crude oil transportation beyond those required by federal law.
  • The Federal Hazardous Materials Transportation Law (HMTA) allows individuals and government entities affected by state or local hazardous materials transportation requirements to apply to the secretary of transportation for a determination of whether federal law preempts those requirements. The secretary of transportation delegated the authority to issue preemption determinations to the PHMSA.
  • The Washington state law, passed in 2019, set vapor pressure limits on crude oil transported by rail with the goal of minimizing the explosion risk in the event of a train accident. 
  • The attorneys general of oil-producing states North Dakota and Montana applied to the PHMSA to determine whether federal law preempted the Washington state law. They argued (1) that the Washington law was an obstacle to implementing the HMTA and (2) that the Washington law was not substantively similar to the federal law.
  • The PHMSA held that the Washington state law did not conform to the U.S. Hazardous Materials Regulations and could disrupt nationwide implementation of the HMTA by encouraging other states to set their own vapor pressure requirements. The PHMSA also cited a Sandia National Laboratories study to support its determination that Washington state’s vapor pressure requirement would not reduce the risk of explosions.
  • Washington state can submit a petition for judicial review of the PHMSA’s order to a federal court of appeals within 60 days. A spokesperson for Washington Governor Jay Inslee (D) said that state officials were disappointed in the agency’s determination and were considering their options.
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In the states

Wisconsin Supreme Court invalidates executive branch stay-at-home order

  • What’s the story? A state court of last resort struck down an executive branch stay-at-home-order for the first time on May 13 when the Wisconsin Supreme Court, in 4-3 ruling, found that Wisconsin Department of Health Services (DHS) Secretary-designee Andrea Palm overstepped her authority by extending the state’s stay-at-home order through May 26 on behalf of Gov. Tony Evers (D).
  • The court held that Palm’s stay-at-home order was “unlawful, invalid, and unenforceable.” The court found that the order met the definition of a rule and, therefore, was required to be promulgated according to the state’s rulemaking process. The court also found that DHS did not have explicit authority from the state legislature to issue the order.
  • Republican lawmakers, who filed the lawsuit, asked the court to strike down Palm’s order and stay its implementation for several days while the state legislature and the governor developed a replacement plan. The court declined to stay the order and restrictions imposed on individuals and businesses were immediately lifted.
  • Justice Patience Roggensack wrote the majority opinion, arguing that rulemaking “exists precisely to ensure that kind of controlling, subjective judgement asserted by one unelected official, Palm, is not imposed in Wisconsin.” Dissenting Justice Rebecca Dallet claimed that the decision will “undoubtedly go down as one of the most blatant examples of judicial activism in this court’s history.”
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Challenges to coronavirus executive orders banning religious gatherings

  • What’s the story? Multiple lawsuits across the country took aim at coronavirus-related emergency executive actions that, according to challengers, exceed the governors’ executive authority by banning or limiting religious gatherings.

    • California: The United States Supreme Court on May 29 denied an application for injunctive relief from California’s religious gathering limits in South Bay United Pentecostal Church, et al. v. Newsom. The California order limits attendance in churches or places of worship to a maximum of 25% or 100 attendees. Chief Justice John Roberts joined the majority in the 5-4 decision, arguing that emergency orders “should not be subject to second-guessing by an ‘unelected federal judiciary,’ which lacks the background, competence, and expertise to assess public health and is not accountable to the people.” 
    • Justice Brett Kavanaugh joined the remaining three Republican-appointed justices in dissenting from the ruling, arguing that the California directive “indisputably discriminates against religion.”
    • Illinois: A three-judge panel of the United States Court of Appeals for the Seventh Circuit on May 16 denied a motion for a temporary stay against Governor J.B. Pritzker’s (D) Executive Order 2020-32, which generally barred gatherings of more than 10 people, including religious gatherings. Plaintiffs in Elim Romanian Pentecostal Church v. Pritzker argued that the governor’s order violated their First Amendment right to the free exercise of religion. In an unsigned order, the panel wrote, “The Executive Order does not discriminate against religious activities, nor does it show hostility toward religion. It appears instead to impose neutral and generally applicable rules.”
    • Plaintiffs appealed to the United States Supreme Court for injunctive relief, and Pritzker responded by allowing the limits on religious gatherings to expire on May 29.
    • Kentucky: Judge Gregory Van Tatenhove of the United States District Court for the Eastern District of Kentucky on May 8 temporarily blocked the state from enforcing its ban on mass gatherings as applied to religious groups. The plaintiffs in Tabernacle Baptist Church, Inc. v. Beshear had argued that state orders restricting mass gatherings and closing churches as non-essential businesses violated their First Amendment rights to the freedom of assembly and the free exercise of religion. Tatenhove argued that “the public interest favors the enjoinment of a constitutional violation.” In a press conference on May 9, Gov. Andy Beshear (D) did not indicate whether his administration would appeal the decision.
    • North Carolina: Judge James Dever of the United States District Court for the Eastern District of North Carolina on May 16 issued a temporary restraining order against a provision of Gov. Roy Cooper’s (D) Executive Order 138 that barred indoor religious services involving more than 10 people. The plaintiffs in Berean Baptist Church v. Cooper claimed that the order violated their First Amendment right to the free exercise of religion. Dever agreed, writing,”There is no pandemic exception to the Constitution of the United States or the Free Exercise Clause of the First Amendment.” A spokesman for Governor Roy Cooper (D) said that the governor would not appeal the decision.
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Maine lawsuit questions whether voters can overturn state agency orders

  • What’s the story? A new lawsuit, Avangrid Networks v. Matthew Dunlap, questions whether the Maine Constitution allows citizens to use ballot initiatives to reverse agency orders. Avangrid Networks Inc. on May 12 asked the Cumberland County Superior Court to block a ballot initiative that aims to overturn a Maine Public Utilities Commission (PUC) decision to grant Central Maine Power Company (CMP) a permit to build new electricity transmission lines.
  • Opponents of the electricity project gathered enough signatures to put the ballot initiative before voters during the November 3 election. Article IV of the Maine Constitution allows citizens to exercise the legislative power through direct initiative.
  • Avangrid argued that the initiative is unconstitutional because it goes beyond an exercise of legislative authority by the people. Avangrid claimed that the initiative “would enact no law, would repeal no law, and would amend no law.” Instead of changing how the agency awards Certificates of Public Convenience and Necessity (CPCN), the ballot initiative would reverse a single PUC order granting a CPNC for the electricity project.
  • Avangrid further argued that the ballot initiative would violate the separation of powers provision found in Article III of the Maine Constitution. The company stated that the initiative would exercise executive authority by reversing an agency order and judicial authority by overturning a related court decision.
  • Thorn Dickinson, CEO and President of New England Clean Energy Connect, supports the lawsuit, claiming that precedent set by the ballot initiative would allow businesses to be shut down “not based on facts or due process but on a never ending appeal by referendum.”
  • Sandi Howard of the group NO CMP Corridor opposed the lawsuit, arguing that “the people of Maine deserve the right to decide what goes through their backyards, and this November, they will have that opportunity.”
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Book review: The Dubious Morality of Modern Administrative Law

The Dubious Morality of Modern Administrative Law, a new book by law professor Richard Epstein, questions whether modern administrative law is immoral. In a review by fellow law professor Jonathan Adler for National Review, Adler observes that Epstein’s book focuses on what the author deems to be the inadequate legal constraints governing administrative agencies rather than other critical concepts, such as the nondelegation doctrine. Epstein also expresses his opposition to Chevron deference, which he claims allows agencies to alter regulatory interpretations without legislative approval.  

Adler finds Epstein’s arguments “engaging, if not always convincing,” and arrives at the following conclusion:

“The ultimate challenge for authors such as Epstein is how to make peace with the administrative state without abandoning a commitment to the rule of law. As Epstein observes, “Fuller’s rule-of-law requirements are more easily satisfied under a classical liberal system of contract, property, tort, and eminent domain than under any modern progressive system.” That is true enough, but even if a wholesale deconstruction of the administrative state were desirable, it is not on the table. Instead the task before us is to maximize the benefits of administration while minimizing the costs, economic and ethical. In this regard, Epstein is to be commended for recognizing the need to consider the contours of an achievable reform agenda, even if he is not wholly successful in the ultimate execution.”

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50-state survey of executive power to removal agency officials

Ballotpedia surveyed all 50 state constitutions and administrative procedure acts (APAs) to learn whether governors had removal powers similar to the President of the United States.

According to the survey, most state constitutions allow governors to remove agency officials. A plurality of those constitutions do not require governors to cite a particular cause before removing an official.

26 states, 52%, have constitutions that grant executive removal power to the governor

  • Of the 26 state constitutions granting removal power, 14 grant at-will removal power (they do not require governors to cite specific reasons for removing officers)
  • Of the 26 state constitutions granting removal power, 12 states protect agency officials from at-will removal by requiring governors to cite a specific cause first

Additional findings showed that the Florida Constitution provides that some officers serve at the pleasure of the governor, some require senate or cabinet approval before the governor may remove them, and some can only be removed by the governor for cause.

  • 4 states, 8%, have APAs that grant the governor removal powers over certain officials
  • The Michigan Constitution and APA both grant removal powers
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Regulatory tally

Federal Register

Office of Information and Regulatory Affairs (OIRA)

OIRA’s May regulatory review activity includes:

  • Review of 56 significant regulatory actions. Between 2009-2016, the Obama administration reviewed an average of 46 significant regulatory actions each May.
  • Thirteen rules approved without changes; recommended changes to 40 proposed rules; three rules withdrawn.
  • OIRA reviewed 36 significant rules in May 2019, 22 significant rules in May 2018, and four significant rules in May 2017.
  • As of June 1, 2020, OIRA’s website listed 139 regulatory actions under review.
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