Author

Jace Lington

Jace Lington is a staff writer at Ballotpedia and can be reached at jace.lington@ballotpedia.org

U.S. Senators Lee and Hawley propose increasing presidential control of agency officials

U.S. Senators Mike Lee (R-Utah) and Josh Hawley (R-Mo.) introduced a bill that would give presidents more control over the administrative state. The Take Care Act, introduced on June 5, 2019, would repeal limitations on the president’s authority to remove Senate-confirmed officials in the executive branch and at independent agencies. The bill aims to make agencies more accountable by allowing new presidents to control agency leadership.
 
After the U.S. Supreme Court decided Humphrey’s Executor in 1935, several laws kept the president from being able to remove agency officials at-will. Under the Take Care Act, Congress would have to pass new laws to restrict presidential removal power in the future. If passed, the Take Care Act would go into effect on January 20, 2021, after the next presidential election.
 


U.S. Supreme Court clarifies Medicare rule change procedures

The U.S. Supreme Court ruled that the Department of Health and Human Services (HHS) must follow informal rulemaking procedures when it changes Medicare policy. In Azar v. Allina Health Services, decided June 3, 2019, the court held that HHS had to give the public notice and an opportunity to make comments before changing the way it reimburses hospitals that serve low-income Medicare patients. At issue was whether or not the change made by HHS counted as a substantive legal change that triggered the rulemaking procedures.
 
Justice Neil Gorsuch wrote the majority opinion, joined by six other justices, affirming that the reimbursement rate was a substantive change subject to notice and comment rules. Justice Stephen Breyer wrote a dissent arguing that the court should have sent the case back to the D.C. Circuit for that court to decide whether the HHS action was exempt from the procedural requirements. Justice Kavanaugh wrote the lower court opinion when he was a judge on the D.C. Circuit, so he did not participate in this case.
 


Trump administration files petition for U.S. Supreme Court to review 4th DACA case

The Trump administration has asked the U.S. Supreme Court to grant expedited review of four cases involving the 2017 decision to end an Obama-era program (DACA) that postponed deportation for children who entered the United States unlawfully. The Fourth Circuit Court of Appeals ruled against the Trump administration’s decision to end the DACA program on May 17, 2019. In response, the solicitor general asked the U.S. Supreme Court to decide whether the decision to end DACA is reviewable by courts and whether the decision to end the program is lawful.
 
Before this latest petition, filed May 24, 2019, the U.S. Supreme court had not acted on three similar pending cases. The court first considered whether to hear the cases during its January 11, 2019, conference but has not made a decision about whether to accept the cases since then. Four justices have to agree to hear a case for it to move forward in the process. The Trump administration is asking the court to combine the cases and consider them together during the fall 2019 term.
 


Unanimous U.S. Supreme Court declines to apply Chevron deference in Social Security case

A unanimous U.S. Supreme Court declined to apply Chevron deference to uphold an agency legal interpretation in a case decided on May 28, 2019. Smith v. Berryhill involved whether the Social Security Administration’s (SSA) dismissal of an appeal in a disability case counted as a final agency action, which would allow the person filing for disability to appeal from the agency to a court. The U.S. Supreme Court ruled that the SSA dismissal was a final agency action that opened the door for judicial review.
 
Part of the court’s opinion in Berryhill involved Chevron deference, which requires courts to uphold reasonable agency interpretations of ambiguous laws. The court held that Chevron is based on the idea that Congress implicitly delegates power to agencies to fill in gaps where laws are unclear. The court reasoned that Chevron did not apply to this case because deciding the scope of judicial review is a responsibility Congress would have delegated to an agency explicitly.
 


Cost-benefit analysis overhaul at EPA in response to Trump executive order

Offices of the Environmental Protection Agency (EPA) are formulating rules to clarify how they weigh the costs and benefits of potential regulations. These rules follow a May 13, 2019, memo from EPA Administrator Andrew Wheeler saying that cost-benefit analyses have varied across the agency in the past and that new rules will promote more transparent and consistent processes.
 
Wheeler’s memo says that the EPA is standardizing its cost-benefit analysis practices in response to President Trump’s Executive Order 13777, which directed agencies to find regulations that impose higher costs than benefits. The memo lists the following guidelines for the new cost-benefit analysis rules:
 
• The EPA should measure and consider costs and benefits when making decisions
 
• The EPA should have consistent interpretations of terms like “practical,” “appropriate,” “reasonable,” and “feasible”
 
• The EPA should explain which factors go into regulatory analyses and how they are used to shape the outcome of regulations
 
• The EPA analyses should follow best practices and sound economic and scientific principles
 


U.S. Supreme Court declines to hear challenge to Chevron deference in UPS case

A fight between UPS and Amazon over how a federal agency determines shipping costs will not proceed to the U.S. Supreme Court. On May 20, 2019, the U.S. Supreme Court declined to hear a case that challenged giving Chevron deference to the way the Postal Regulatory Commission (PRC) sets package delivery prices. UPS argued that the D.C. Circuit made a mistake in its May 22, 2018, opinion applying the Chevron doctrine to uphold the formula used by the PRC to set postal rates for deliveries of packages.
 
 
The Chevron doctrine is an administrative law principle that compels federal courts to defer to a federal agency’s interpretation of an ambiguous or unclear statute that Congress delegated to the agency to administer. The principle derives its name from the 1984 U.S. Supreme Court case Chevron v. Natural Resources Defense Council.
 
In its 267-page petition, UPS asked the U.S. Supreme Court to reconsider the Chevron doctrine in light of the following criticisms:
  • “It threatens the proper separation of powers by shifting legislative and judicial responsibilities to executive agencies”
  • “There is no legal basis for the assumption that Congress implicitly delegates interpretive authority to agencies”
  • “Chevron (with its attendant limitations) is enormously difficult to apply in practice.”
  • “Several Justices have recognized that this powerful criticism warrants a reconsideration of Chevron by the Court.”
In its 2018 ruling, the D.C. Circuit held that the PRC formula was based on a permissible interpretation of an unclear part of the 2006 Postal Accountability and Enhancement Act (Accountability Act). The court said that the agency interpretation was consistent with longstanding practice stretching back to 1975. Under Chevron, courts defer to reasonable agency interpretations of ambiguous laws.
 
 
Additional reading:
 
Text of UPS’ petition for a writ of certiorari:
 
Text of the D.C. Circuit Decision:


U.S. Senators Lankford (R-Okla.) and Sinema (D-Ariz.) propose giving the public early access to the rulemaking process

A proposed bill would require agencies to request written feedback from interested people regarding new major rules earlier in the regulatory process. Senators James Lankford (R-Okla.) and Kyrsten Sinema (D-Ariz.) introduced Senate Bill 1419, the Early Participation in Regulations Act, on May 13, 2019. The act requires agencies to issue advance notices that they will be proposing a rule at least 90 days before the agency publishes the proposed rule in the Federal Register.
 
The act states that advance notices have to provide time for interested people to submit their views to the agency in writing and have to include the following:
  • The nature of the problem the agency plans to address with a new major rule
  • The data the agency expects to use to formulate the rule
  • A description of the regulatory alternatives the agency is considering
  • The legal authority under which the major rule may be proposed
  • An achievable objective for the major rule
S. 1419 follows other federal standards and defines major rules as those that have or are likely to have the following results:
  • An annual effect on the economy of $100 million or more
  • A major increase in costs or prices for consumers, individual industries, government agencies, or geographic regions
  • Significant effects on competition, employment, investment, productivity, innovation, health, safety, the environment, or on the ability of U.S.-based enterprises to compete with foreign-based enterprises in domestic and export markets
Rules that do not require published notices of proposed rulemaking (NPRM) in the Federal Register are not subject to the act. Those exempted rules include guidance documents, which are interpretive rules, policy statements, and agency rules of organization. Beyond guidance, agencies can choose not to publish NPRMs for new rules if they find good cause and explain their reasoning in the rule they issue. Finally, if the administrator of the Office of Information and Regulatory Affairs (OIRA) determines that compliance would not serve the public interest or would be too burdensome and redundant based on the requirements of other laws, then the agency does not have to publish an advance notice of proposed rulemaking (ANPRM) under the act. OIRA is an office within the Office of Management and Budget (OMB) that handles regulatory review, information collection requests, and oversight of government statistics and privacy policies.
 
 
Additional reading:
 
Text of S.1419 (The Early Participation in Regulations Act):
 
 


U.S. Senators Sinema (D-Ariz.) and Lankford (R-Okla.) propose requiring agencies to perform retrospective reviews of regulations

A new bill aims to help administrative agencies meet regulatory goals by requiring them to assess the effectiveness of new major rules. Senate Bill 1420, The SMART Act of 2019, would require agencies to publish ideas about how to measure the anticipated benefits of new major rules, including how to collect the necessary data to conduct such a review. Senators Kyrsten Sinema (D-Ariz.) and James Lankford (R-Okla.) introduced the bill on May 13, 2019.
 
The act instructs agencies to perform cost-benefit reviews of major rules to determine whether they are accomplishing their objectives, are no longer necessary, or need to be improved. It follows other federal standards and defines major rules as those that have or are likely to have the following results:
  • An annual effect on the economy of $100 million or more
  • A major increase in costs or prices for consumers, individual industries, government agencies, or geographic regions
  • Significant effects on competition, employment, investment, productivity, innovation, health, safety, the environment, or on the ability of U.S.-based enterprises to compete with foreign-based enterprises in domestic and export markets
The provisions of the SMART act apply to rules that meet those criteria as determined by the administrator of the Office of Information and Regulatory Affairs (OIRA). OIRA is an office within the Office of Management and Budget (OMB) that handles regulatory review, information collection requests, and oversight of government statistics and privacy policies. The act exempts guidance documents, which include interpretive rules, policy statements, and agency rules of organization, from its review requirements.
 


Bill restructuring the way small business regulations are considered introduced in the Senate

A new bill restructuring the way small business regulations are considered was introduced in the Senate on May 7, 2019. The Prove It Act (PIA), introduced by U.S. Senators Joni Ernst (R-Iowa) and Kyrsten Sinema (D-Ariz.), would allow the Small Business Administration (SBA) to require agencies to reconsider findings claiming new regulations would not affect small businesses. The bill would amend the Regulatory Flexibility Act (RFA), a 1980 law that requires federal agencies to consider the effects of potential regulations on small businesses, nonprofits, and local governments.
 
Under the existing RFA, an agency can avoid publishing detailed analyses of the potential effects of a regulation if the agency head certifies that the regulation will not impose significant economic costs on a substantial number of small entities. The PIA would allow the SBA to challenge potential regulations before they go into effect by asking agencies to reconsider their conclusions about the effects of new regulations on small businesses.  The PIA would also require agencies to conduct a full analysis of proposed rules if the agency determines that an initial certification was incorrect.
 
According to Senator Ernst, the bill would give the “small business community the opportunity to send agencies back to the drawing board to ‘prove’ that what they’re proposing won’t hurt small businesses.” Under the PIA, SBA requests for agency reconsiderations would be published in the Federal Register, but the agency would still decide whether the original agency conclusions were correct and supported by facts.
 
You can read more about the RFA and SBA and here:
 
Additional reading:


Final rule to require drug price disclosure in TV ads

A new rule requires pharmaceutical companies to include the list price of some prescription drugs in television advertisements. The requirement applies to medicines covered by Medicare or Medicaid dollars, according to a final rule published by the Centers for Medicare & Medicaid Services (CMS) on May 10, 2019.
 
The agency intends for the rule to make Medicare and Medicaid administration more efficient by giving beneficiaries of the programs more information about the costs of drugs, according to the summary of the final rule published in the Federal Register.
 
The CMS final rule aims to make drug prices more transparent and “is the single most significant step any administration has taken toward a simple commitment: American patients deserve to know the prices of the healthcare they receive,” according to U.S. Department of Health and Human Services (HHS) Secretary Alex Azar. The rule requiring companies to disclose prices in TV ads is part of a broader Trump administration plan aimed at reducing prescription drug prices. CMS argues that the new rule will use public scrutiny to pressure manufacturers into lowering drug prices and will equip patients to make more informed healthcare decisions.
 
Several public comments submitted to CMS before it finalized the rule argued that the proposal went beyond the agency’s authority under the Social Security Act. The commenters said that the provisions within the Social Security Act interpreted by CMS in the final rule are general housekeeping measures and “not broad delegations of authority.” CMS responded by arguing that the law empowers the secretary of HHS to issue “regulations as necessary for the efficient administration of Medicare and Medicaid.” The agency argued that the pricing disclosure requirements are acceptable since Secretary Azar determined that they were necessary to carry out the administration of Medicare and Medicaid.
 
The final rule is effective on July 9, 2019.
 
The Federal Register is a legal newspaper that contains proposed and finalized agency rules and regulations in addition to policy statements, interpretations of existing rules, and presidential documents like executive orders.
 
A final rule, in the context of administrative rulemaking, is a federal administrative regulation that went through the proposed rule and public comment stages of the rulemaking process and is published in the Federal Register with a scheduled effective date. The published final rule marks the last stage in the rulemaking process and includes information about the rationale for the regulation as well as any necessary responses to public comments.
 


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