NAHO 2013 Conference St. Paul, Minnesota. What are Administrative Agencies1 Constitutional structure...
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- NAHO 2013 Conference St. Paul, Minnesota
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- What are Administrative Agencies1 Constitutional structure
Separation of powers; Checks and Balances Both federal and state
constitutions divide governmental power into three branches of
government: Executive, legislative, and Judicial. Both federal and
state governments in the US have the same type of structure. Each
branch has a core function and also has powers to check the other
branches of government. Tyranny and abuse of power was feared more
then inefficiency.
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- 3 (3) Judicial (1) Legislative (2) Executive Enacts Statutory
Law Enforces the Law Case Law: Interprets Statutory Law Case Law:
Creates Common Law (state) Remedies usually $ Equity fairness
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- What are Administrative Agencies2 Administrative agencies are
located in the executive branch [Article II of the U.S.
constitution] (enforces the laws). The legislative branch consists
of the two houses of Congress [Article I of the U.S. constitution]
(enacts statutory law). The judicial branch of the U.S. Government
consists of the Supreme court and lower federal courts [Article III
of the U.S. Constitution] (decides cases or controversies and
interprets the law)
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- What are Administrative Agencies3 1. Most agencies carry out
law enforcement functions (speaking broadly of civil and
administrative law enforcement, such as inspections, subpoenas, and
record keeping requirements). 2. Most agencies are subject to
judicial review in the federal (or a state) court system (checks
and balances) 3. Virtually all agencies are creatures of statutes,
and their agency enabling acts (organic statutes) are enactments of
congress (or a state legislature) that create the agencies and give
them powers and responsibilities (delegation of powers).
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- What are Administrative Agencies4 FAPA Section 551(1)
definition Administrative Agencies are in the Executive Branch (1)
agency means each authority of the Government of the United States,
whether or not it is within or subject to review by another agency,
but does not include (A) the Congress; (B) the courts of the United
States; (C) the governments of the territories or possessions of
the United States; (D) the government of the District of
Columbia;
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- What are Administrative Agencies5 2010 Revised Model State APA
Section 102(3) (3) Agency means a state board, authority,
commission, institution, department, division, office, officer, or
other state entity that is authorized by law of this state to make
rules or to adjudicate. The term does not include the Governor, the
[Legislature], or the Judiciary. Professor Ogden was the reporter
for the Revised MSAPA from 2006-2010.
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- Appointment of Officers 1 1. Presidents and governors exercise
control over executive branch agencies through the power to appoint
and remove the top officials of the agency. In most agency
settings, there will be some political appointees, including the
agency head, but most of the employees of the agency will be
selected through civil service systems set up in that jurisdiction.
Civil service systems were established as a merit selection reform
to eliminate patronage appointments of individuals who were
beholden to the appointing authority but who were also often not
qualified for the job they were asked to do.
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- Buckley v. Valeo 1 Facts: The Federal Election Commission has
eight members, six of whom are voting members. Of the six, two are
appointed by the President pro tem of the senate, two by the
speaker of the house, and two by the President. This lawsuit was
brought to challenge the appointment structure on separation of
powers grounds, that the appointment clause for officers of the US
provided the exclusive method for appointing Officers of the US and
inferior officers, and that Congress did not have appointment
powers under either category. The commission members exercise
significant authority related to enforcement of the laws of the US.
[Buckley v. Valeo 424 U.S. 1 (1976)
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- Buckley v. Valeo 2 2.The US Supreme court held that the
appointment structure violated Art. II, S 2, cl. 2 because the
commission exercises law enforcement (executive) power, operates
like an independent regulatory agency, and those powers can only be
exercised by Officers of the US who are appointed following the
constitutionally prescribed method. 3. The US constitution was very
specific about the requirements for appointments. The supreme court
upheld a formalist or textualist approach to this issue.
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- Appointing officers in the states 1 1. Marine Forests Society
v. California Coastal Commission: In this case, the California
Supreme court upheld an appointment structure that violated the
principles of Buckley v. Valeo. Buckley was not a controlling
precedent because the challenge was based upon the California
Constitution not the US constitution. There were 12 appointees on
the commission 4 appointed by the governor, 4 by the senate rules
committee, and 4 by the speaker of the assembly. The court upheld
this structure based upon the California constitution, which did
not have anything like the officers of the US language in the US
constitution. There are limits to legislative appointment of
executive branch agency officials, and legislators could not retain
the power to remove their appointees
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- Appointing officers in the states 2 Selection of agency
officials in the states is more complex. Most agency employees are
hired under civil service system rules. The top agency officials
may be elected (California Attorney General), or they may be
selected by the state governor with or without legislative
confirmation. States have a mixture of executive branch and
independent regulatory agencies. Most state public utility
commissions are independent regulatory agencies for both historic
and structural reasons.
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- Removal of Officers 1 1. The Myers v. US decision invalidated a
statute that had required the consent of the senate before a
President could remove a presidential appointee. The court held
that this unduly interfered with the Presidents executive powers.
In the later Humphreys Executor case, the court upheld limits on
the presidential removal power for FTC Commissioners. That
structure is still used today. Most cabinet officials serve at the
pleasure of the president, and most independent regulatory agency
commissioners serve fixed terms and can be removed only for good
cause. [Myers v. US, 272 U.S. 52 (1926)]
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- Removal of Officers 2 Facts: In this case, President Roosevelt
wanted to remove the FTC chair, William Humphrey, who had been
appointed by President Hoover. Roosevelt fired Humphrey after he
refused to resign, but Roosevelt did not rely on good cause, but
rather on political considerations. After his death, the estate
sued for recovery of Humphreys salary. The Supreme court upheld
Humphreys claim and concluded that the good cause removal standard
did not violate separation of powers. This fueled the rise of the
modern independent regulatory agency. IRAs are structured to have
greater independence from the president, unlike executive branch
agencies. They are meant to be nonpartisan, impartial, and to
regulate in the public interest. [Humphreys Executor v. U.S. (1935)
295 U.S. 602]
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- Agency Characteristics 1 I. What are administrative agencies A.
Executive branch: Administrative agencies are located in the
executive branch of federal and state government. Agency
characteristics include: 1 Law enforcement responsibilities
including inspections, searches, audit powers, subpoena power,
benefit granting powers, regulatory powers (Example: Safety
inspectors for OSHA or Mine Safety Agency inspect work places, and
cite employers for violations of workplace safety standards) 2
Appointment of agency heads by the President (federal) or Governor
(state) with advice and consent of the Senate or state legislature
(Example: Attorney General or EPA administrator)
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- Agency Characteristics 2 3 Cabinet agencies: policy preferences
consistent with the President or Governor currently in office
(single head cabinet agencies); serve at the pleasure of the
President or Governor (Example: State Department or Environmental
Protection Agency 4 Independent agencies: Policy independence for
independent regulatory agencies that have multi member boards (5 to
7 appointees) serving fixed terms in office with good cause removal
standards and political balance in membership. (Example: Federal
Communications Commission or state public utilities
commissions)
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- Agency Characteristics 3 Expertise in subject area of
regulation: Agencies are created to address specific public policy
problems by devoting full time attention to those problems as
structured by Congress or a state legislature in an agency enabling
act (organic statute). Agencies have a permanent staff and budget
which allows the development of expertise in addressing the
problems that they are charged with regulating. (Example: The
Environmental Protection Agency (EPA) or the California Air
Resources Board).
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- Agency Types 1 B. Types of Agencies: agencies have a variety of
missions to carry out depending upon the enabling act that creates
the agency and gives the agency powers. Industry specific
regulation Examples: public utilities (state public utilities
commissions); aviation (federal aviation administration)
telecommunications (federal communication commission) securities
industry (securities exchange commission)
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- Agency Types 2 Subject specific regulation (cutting across all
industries) Examples: federal trade commission (antitrust law and
unfair trade practices); environmental protection agency
(environmental law); national labor relations board (labor
relations law) Benefit granting agencies Examples: social security
administration (disability benefits, and Medicare benefits);
workers compensation agencies (workers compensation benefits);
unemployment benefits (state employment agencies); welfare benefits
(TANF state and local agencies)
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- Agency Types 3 Licensing agencies Examples: nuclear regulatory
commission (licensing of nuclear power plants); professional and
business licensing agencies (e.g. State Bar of California licenses
attorneys) Labor relations agencies Examples: national labor
relations board (private sector labor law); public employees
relations board (public sector labor relations)
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- Agency Powers 1 C. Agency Powers Enforcement Powers: powers
typically granted by agency enabling act including inspections,
searches, audit powers, subpoena power; [Executive Powers]
Rulemaking Powers: authority to adopt rules granted by enabling
act, but required procedures for rulemaking governed by
administrative procedure act applicable to the agency [Legislative
powers]
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- Agency Powers 2 Adjudicative powers: authority to provide
adjudicative hearings to resolve disputes granted by enabling act
but procedures used for adjudication governed by administrative
procedure act applicable to the agency. [Judicial Powers]
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- Executive Power 1 Agencies conduct investigations 1. Most
administrative agencies have regulatory and law enforcement powers.
The agency mission is to enforce the provisions of the enabling act
that creates and empowers the agency. This is why agencies fit into
the executive branch structure to carry out law enforcement
functions. 2. the term law enforcement in administrative law is
much broader than criminal law (though some administrative law
violations are punished criminally through the regular criminal
court systems) because it includes civil and administrative
enforcement systems
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- Executive Power 2 3. To carry out the law enforcement
responsibilities, agencies need information from regulated parties.
Four methods are used to obtain relevant information. A. Record
Keeping required by law (e.g., employers have to keep records of
wage payments to employees; people subject to income tax liability
have to keep records of income and expenses). B. Report writing
(and filing) (e.g., employers have to prepare and file with the IRS
employee income information ( W-2 reports) or independent
contractor income (IRS 1099 form); Taxpayers have to file annual
IRS 1040 forms.)
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- Executive Power 3 C. Investigative subpoenas to compel
testimony and production of records ( e.g., employer in Craib v.
Bulmash case had to produce wage records for caregivers for his
sister to determine compliance with state wage and hour laws). D.
Administrative Searches for inspection of the non public parts of
homes and businesses to determine compliance with health and safety
standards (e.g., OSHA safety standards compliance in Marshall v.
Barlows note case),
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- Executive Power 4 4. Another technique is compliance audits (
e.g., audit of client trust accounts held by lawyers.). Some of the
investigative techniques are used to determine whether or not
possible violations of the law have occurred. These techniques
would precede any adjudicatory enforcement action brought by the
agency. 5. the first two methods (record keeping and report
writing)rely primarily on voluntary compliance by the regulated
parties, but lots of time and money can be spent to comply with
these methods.
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- Executive Power 5 6. The 3 rd and 4 th techniques ( subpoenas
and administrative inspections) are not voluntary. Disclosure of
information is compelled, sometimes to determine if the law has
been violated, and sometimes to gather evidence for an enforcement
proceeding. 7. Compelled disclosure of information raises questions
under the Fourth and Fifth Amendments to the U. S.
Constitution
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- Legislative Power 1 Federal APA Rulemaking procedures: 5.
U.S.C. Section 553 governs rulemaking procedures: A. Notice
[Section 553(b)provides: General notice of proposed rule making
shall be published in the Federal Register, unless persons subject
thereto are named and either personally served or otherwise have
actual notice thereof in accordance with law.. B. Comment [Section
553(c) provides After notice required by this section, the agency
shall give interested persons an opportunity to participate in the
rule making through submission of written data, views, or arguments
with or without opportunity for oral presentation
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- Legislative Power 2 Federal APA Rulemaking procedures: 5.
U.S.C. Section 553 governs rulemaking procedures: C. Statement
[Section 553(c) provides: After consideration of the relevant
matter presented, the agency shall incorporate in the rules adopted
a concise general statement of their basis and purpose. D.
Publication [Section 553(d) provides: (d) The required publication
or service of a substantive rule shall be made not less than 30
days before its effective date
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- Legislative Power 3 2010 Revised MSAPA rulemaking procedures:
A. Notice [Section 304]; B. Regulatory Analysis [Section 305]; C.
Comment [Section 306]; D. Adoption and Publication [Section 307] E.
Concise Explanatory Statement [Section 313]
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- Judicial Power 1 The federal APA uses the external hearing
rights approach. 5 U.S.C. Section 554(a) provides: (a) This section
applies, according to the provisions thereof, in every case of
adjudication required by statute to be determined on the record
after opportunity for an agency hearing. To enforce this provision
courts look for and seek to find in statutes(other than the APA)
language that uses the underlined terms or their equivalent. We
will see how this issue is resolved in the Dominion case.
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- Judicial Power 2 The 2010 Revised Model State APA (MSAPA) uses
the external hearing rights approach as well. Section 102(7)
provides: (7) Contested case means an adjudication in which an
opportunity for an evidentiary hearing is required by the federal
constitution, a federal statute, or the constitution or a statute
of this state. Section 102 (11) provides: Evidentiary hearing means
a hearing for the receipt of evidence on issues on which a decision
of the presiding officer may be made in a contested case. With this
approach, hearing rights are governed by law other than the APA,
but hearing procedures are governed by the APA. This is the same as
the Federal APA, except for the constitutional language in Section
102(7).
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- Judicial Power 3 Right to a trial type APA adjudicative hearing
in state administrative law: 1. External Hearing rights: California
[Ca. Gov. Code Section 11410.10. This statute provides: this
chapter applies to a decision by an agency if, under the federal or
state Constitution or a federal or state statute, an evidentiary
hearing for determination of facts is required for formulation and
issuance of the decision. 2. APA Hearing rights approach: This is a
minority approach under which the APA provides for an all inclusive
definition of adjudication and requires APA hearings for all
adjudications whether or not an external source of law requires
hearing rights
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- What is Administrative Law 1 D. Administrative Law
Administrative law is the law governing executive branch agencies
like the environmental protection agency as well as independent
regulatory agencies like the Securities Exchange commission.
Administrative law provides the legal principles and rules that
those agencies have to follow when they enforce their substantive
governing law. Administrative law is a good course for lawyers who
want to practice in public law or regulatory law fields like
environmental law, securities law, labor law, antitrust law, and
others.
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- What is Administrative Law 2 Administrative law principles are
applicable to both federal and state administrative agencies.
Administrative law principles govern the procedures used by
agencies when they engage in rulemaking (adopting administrative
regulations) adjudication (deciding administrative cases), and
enforcing the law (inspections, subpoenas). Administrative law is a
procedure course, but it has lots of constitutional concepts like
separation of powers.
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- What is Administrative Law 3 Sources of law for administrative
law: 1. Federal and state constitutions (e.g., Due Process of law)
2. Statutes (federal and state administrative procedures act;
agency enabling acts) 3. Common Law (federal and state appellate
decisions) 4. Regulations (agencies that have rulemaking authority
sometimes adopt procedural rules that govern proceedings before the
agency)
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- Administrative Procedures Acts 1 E. Administrative Procedures
Acts 1945 California (state agencies in California) Revised and
amended 1979 ( rulemaking chapters) and 1995 (new adjudication
chapters) 1946 Federal APA (federal agencies) 1946 MSAPA (state
agencies in adopting states) 1961 MSAPA (state agencies in adopting
states) 1981 MSAPA (state agencies in adopting states) 2010 Final
Revised MSAPA (same)
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- Administrative Procedures Acts 2 1. Federal APA: 5 U.S.C.
Sections 551 to 706 2. 2010 Revised Model state APA ( adopted, July
2010, Uniform Law Commission 3. State APAs (e.g., California APA;
California Government Code Sections 11340 -11529) Administrative
Procedures Acts provides the required procedures for agencies to
follow when enforcing the substantive law the agency is responsible
for (agency enabling act)
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- Administrative Procedures Acts 3 2010 Revised MSAPA Seven
articles Article One: Definitions Article Two: Public Access
Article Three: Rulemaking Article Four: Contested Case Article
Five: Judicial Review Article Six: Office of Administrative
Hearings Article Seven: Rules Review
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- APA Topics (evolution of subjects) Definitions of key terms
(1945-1946) Public access to agency law and policy (internet era,
2000s) Freedom of Information Act (public records acts) (1970s)
Government in the sunshine act (open meetings laws) (1970s)
Rulemaking procedures (1945-1946) Adjudication procedures
(1945-1946) Judicial Review procedures (1945-1946) Legislative
review procedures (1980s) Central panel hearing procedures (1980s
to date; 25 states)
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- Brief History of Admin. Law 1 III. History of American
Administrative Agencies (post civil war and post industrial
revolution) 1. 1887 1890 Controlling Monopolies and Rates
Interstate Commerce Commission (ICC) 2. 1906 1915 Regulating
Product Quality Federal Trade Commission Predecessor to FDA
(USDA)
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- Brief History of Admin. Law 2 3. 1930 1940 Extending Regulation
for Socioeconomic Purposes and Technology Advancements Food and
Drug Administration Social Security Administration Federal
Communications Commission Federal Power Commission National Labor
Relations Board Securities Exchange Commission Civil Aeronautics
Board Federal Aviation Administration
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- Brief History of Admin. Law 3 4. 1960 1979 Extending Regulation
to Enhance Public Health and Safety and to Promote Fairness in the
Workplace and Community Equal Employment Opportunity Commission
Environmental Protection Agency Occupational Safety and Health
Administration Consumer Product Safety Commission Civil Rights
division of Justice Department Occupational Safety and Health
Commission
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- Brief History of Admin. Law 4 5. 1978 to 2000 Deregulation
Movement to Reduce Bureaucratic overexpansion Office of Management
and Budget (OMB) Office of Information and regulatory affairs
(OIRA) Abolition of CAB (airline rates) Deregulation of banking and
savings and loan industry Telecommunications partial deregulation
(FCC) Welfare Reform (TANF)
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- Brief History of Admin. Law 5 6. 2001 to 2011 War on Terror,
Globalization, and Economic Stability Patriot Act Department of
Homeland Security World Trade Organization Health care legislation
(HHS) Dodd Frank legislation (new consumer finance agency) Sarbanes
Oxley (new powers for SEC) corporate regulation
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- The future What pressing issues do we face today as a notion
and how can administrative agencies respond to those issues? 1.
Global economic issues. 2. Global environmental issues. 3. aging
populations in many advanced economies. 4. entitlements and
debt.