Agency Rules & Regulations

1. Agency
Rules and Regulations

2. Purpose
The rules of the agency are the details the
agency establishes to implement the
enabling statute of the agency and the laws
of the legislature.
Used to solve problems of public concern
Implement a policy or requirement of the agency
Rules and regulations of federal
government are complied in the Code of
Federal Regulations (CFR)
Rules and regulations of Tennessee kept
with Secretary of State

3. What is Rulemaking?
Following of established procedures such
as publication of notice of proposed rules
and also publication of a final rule.
Types
Informal – Interested parties are allowed to make
comments (oral/mail)
Formal – Interested parties may present
evidence and cross examine witnesses at
hearings.

4. Rule vs. Decision
Rule – synonymous with a regulation.
Legislative function in an agency; they
enforce legislative goals
Decision – An adjudicatory function of an
agency; they resolve disputes

5. Rule vs. Decision
Rule
Implements laws
Directed toward
future
Applicable to large
group
An agency
legislative function
Decision
Solves conflict
Resolves past
problem
Applicable to
specific persons
An agency judicial
function

6. Requirements of Rulemaking

7. Federal Rulemaking
Found in Administrative Procedures Act at
5 USC §553
Section (a) lists the exceptions to rulemaking
Section (b) explains the notice required
Section (c) relates to participation requirements
Section (d) states the publication needed
Section (e) allows petition rights

8. Pros & Cons of APA
Pros
Reasonableness -
requires the purpose for
a rule/reg. to be stated,
along with basis and
authority
Waiting period – allows
agency to prepare for
rule
Provides standardized
enforcement of rules
Opportunity for public
participation
Cons
Time consuming
May be subject to
Court challenge.

9. Tennessee Rulemaking
Tenn. Code Ann. Title 4, Chapter 5, Part 2
Notice made to secretary of state
Statement of time, place hearing to be held
Rules have to be approved by the attorney
general
Rules become effective 90 days after being filed

10. Legislative Guidelines
Because the legislature enacts the statute
that creates the agency and gives it the
power to make rules, the legislature is the
guiding force in rulemaking.
Three types of agency rules
Substantive
Interpretive
Procedural

11. Substantive Rules
Sometimes called legislative rules
Carry out the intent of the legislative statute
in a detailed manner
Binding for two reasons;
They have been established through a formal,
legislative type process – rulemaking – and have
usually changed an existing situation
They are carrying out the intent of a statute

12. Substantive Rules
FDA v. Brown & Williamson Tobacco Corp.
(2000)
FDA created rule to reduce tobacco consumption
among children and adolescents.
Felt they had authority because they regulate the
sale and distribution of tobacco products. Also
felt rule necessary for providing reasonable
assurance of safety
Court ruled this was not a power Congress
granted – FDA did not have right to regulate
tobacco products

13. Interpreter Rules
Explains an agency’s action in
implementing a statute and also explain the
statute itself.
These rules are practical explanations of an
agency’s actions by providing guidelines to
the public
These rules are usually respected by courts
because of agency’s expertise.

14. Interpreter Rules
Nat’l Family Planning and Reproductive
Health Assoc. Inc. v. Sullivan (1992)
Deals with 1988 Department of Health and
Human Services regulation that prohibited all
health care providers from providing abortion
counseling and referrals. Amid political uproar
HHS decided to “interpret” rule to allow doctors
to provide counseling, as rule was not intended
to interfere with doctor-patient relationship.
Challengers brought action alleging that the
directive established a new substantive rule.

15. Interpreter Rules
Nat’l Family Planning and Reproductive
Health Assoc. Inc. v. Sullivan (1992)
Court analyzed difference between an
interpretive and substantive rule
Court held that the directive did not simply
explain or clarify the 1988 regulation, but it is
substantially amending and even repudiating the
original legislation. Therefore, the agency must
adhere to the notice and comment requirements
of the APA.

16. Procedural Rules
Govern the proceedings and practices
within the agency
Establish procedures necessary for an
agency to function, such as rules of
conduct for informal hearings
Can be used to protect the rights of the
client

17. Hybrid Rules
The combining of a legislative and judicial
function in rulemaking
Example: Cross-examination of a witness
in a proceeding to gather information to
make a new rule is a judicial function within
the legislative function of rule-making.

18. Rulemaking Procedures

19. Informal rulemaking
Most common type of rulemaking, and its
purpose is to inform the agency of the
various views and comments of interested
participants, some of whom may be experts
Three process
Notice of the proposed rule published,
Participation by interested parties, and
A statement of the basis and purpose in the final
rule

20. Informal Rulemaking Processes
Notice
 Must be published in the Federal Register; and
 Must cite the proper statute and legal authority
Participation
 May include oral or written comments
 Participants should be given time, place, and address
to make comments
Statement of Purpose
 Issues should be presented in a concise and specific
manner
 Publication must occur 30 days before law becomes
effective

21. Formal Rulemaking
Demands that rules must be made “on the
record after the opportunity for an agency
hearing.”
Only the legislature has power to order
Hearings must follow judicial procedures
and be trial-like
Publication of notice of the hearing date,
Conduct of a trial-type hearing, and
Publication of a final rule with “findings and
conclusions”

22. Formal Rulemaking Processes
Notice – same as informal (date/legal
authority)
Hearing
 Requires production of evidence and cross-
examination of witnesses
 Not as stringent at court hearing
Final rule publication
 After hearing, hearing officer submits “findings and
conclusions, and the reasons or basis thereof, on all
material issues of fact, law, or discretion presented
on the record.”
 Published 30 days before becoming effective

23. Vermont Yankee Nuclear Power Corp v.
Natural Resources Defense Council (1978)
Decided the question of informal rulemaking
procedures by upholding the procedural
requirements of the APA (notice, comment, and
publication)
Vermont Yankee received a permit to build a
nuclear power plant, but they were not granted an
operating license.
They alleged that procedures used by the agency
were inadequate because cross-examination and
discovery (a hearing) was not available to them.

24. Fundamental policy questions with respect to
development of nuclear energy are
appropriately resolved in Congress and the
state legislatures and are not subject to
examination in federal courts under the guise
of judicial review of agency action.
Bottom line – agencies have the right to decide
their own rules of procedure, as long, as the
procedures follow the minimum standards of
the APA and the enabling act of the creating
agency.
Vermont Yankee Nuclear Power Corp v.
Natural Resources Defense Council (1978)

25. United States v. Florida East Coast
Railway (1973)
Two railroad companies brought action to
set aside the incentive per diem rates
established by the ICC. The incentives
were created to relieve freight car
shortages across the nation
Railroads petitioned against the informal
rulemaking procedures, claiming that the
ICC statute demand formal rulemaking
procedures “after hearing.”

26. United States v. Florida East Coast
Railway (1973)
Court ruled that “after hearing” does not
equal the APAs “on the record after
opportunity for an agency hearing.”
Bottom line – Informal rulemaking satisfied
the ICC and the APA statutes.

27. Policy Statements
Explain the objectives of agency actions
Used to encourage uniformity, clarify
conflicting situations
May be subject to judicial review, if too far
from past practices