In chapter 5 at 5.5 we learned that administrative agencies exist at all levels of government and are sources of law because they enact, enforce, and adjudicate violations of rules and regulations. Here we will focus on the three main functions of federal agencies and discuss two limitations on them.
The three main functions of federal agencies are rulemaking, enforcement, and adjudication; these functions are collectively referred to as the administrative process. All federal agencies must follow specific procedural requirements in the administrative process. Congress occasionally specifies certain procedural requirements for an agency. If not, however, federal agencies follow the Administrative Procedure Act (APA), which Congress passed in 1946.
The APA provides that rulemaking is the process for formulating, amending, or repealing an agency rule. In chapter 5 at 5.5 we discussed briefly the three types of agency rules—procedural, interpretive, and substantive. We also learned that substantive rules are commonly referred to as regulations; regulations are the rules where an agency adds detail, expertise, or standards to a statute passed by Congress and delegated to the agency.
An agency follows a specific process to adopt substantive rules. First, an agency provides notice by publishing the proposed rule and the basis for it in the “Federal Register.” Second, the agency allows a comment period (which is generally at least 30 days) for any interested persons to submit written data, views, or arguments to the agency (to which the agency responds). The agency will then republish in the Federal Register the proposed rule and basis with the agency’s responses to the public comments. Thereafter, assuming no more changes, the proposed rule becomes a final rule and is published in the Code of Federal Regulations, which is customarily referred to as the “CFR.”
Procedural and interpretive rules do not need to go through the notice and comment process. They do not have the same legal force as substantive rules. You will recall from chapter 5 that procedural rules describe the agency’s organization, procedure, or practice requirements; and interpretive rules include general statements of policy.
An agency conducts investigations to ascertain whether a party has violated the agency’s rules. Three tools that an agency uses to conduct investigations are inspections, subpoenas (which are orders compelling a witness to testify or to produce documents), and search warrants (which are orders directing law enforcement to search a specific place for a specific item).
The APA provides that adjudication is the process for the formulation of an order. This means that after completing an investigation, an agency may take administrative action against a party. Most administrative actions are resolved through negotiated settlements at their initial stages without the need for formal adjudication. These negotiated settlements are called “consent decrees.” But if not resolved, the steps of adjudication are as follows. The agency will issue a complaint against the suspected violator. The party charged in the complaint will respond by filing an answer to the agency’s allegations. If the agency and party charged do not settle, the case is heard in a trial-like hearing before an Administrative Law Judge (ALJ). This is similar to a court case, but not as formal. Following the hearing, the ALJ will issue an order. Either party may appeal the ALJ’s order within the agency; this is called “chain of review.”
Two limitations on federal agencies are judicial review and disclosure of information.
12.4 Judicial Review
The APA provides for judicial review of most agency decisions. After working its way through the “chain of review,” a party has “exhausted its administrative remedies.” Any further appeal that a party may have would typically be to the US district courts; this is called judicial review. (Do not get confused by the terminology here. Judicial review in the administrative law context differs from the concept of judicial review generally that we discussed in chapter 5 at 5.4.)
12.5 Disclosure of Information
There are three federal statutes that require public disclosure of agency information. The Freedom of Information Act, enacted in 1966, requires federal agencies to disclose certain records to any person upon request, unless the records are specifically exempted. There are many exemptions, among the most obvious ones are documents related to national defense and foreign policy. The act is commonly known as “FOIA”; and parties seeking information under the act are said to be making a “FOIA request.” The Privacy Act, enacted in 1974, protects certain federal agency records pertaining to persons by prohibiting unauthorized disclosures of those records (e.g., social security numbers). The act attempts to prevent misuse of personal information kept by an agency. It is applicable to federal agencies and contractors, including states or business entities receiving federal contracts. The Government in the Sunshine Act, enacted in 1976, requires federal agency meetings to be open to the public unless a meeting is specifically exempted. Similar to FOIA, meetings regarding national defense or foreign policy concerns are exempted.