Federal agencies take hit to rulemaking power

(The Center Square) – The power of federal regulatory agencies took a major hit in recent days with a couple of court rulings that will have wide-reaching implications.

The blocking of federal overreach is a theme of President Joe Biden’s administration, which has tried several expansive measures only to be slapped down by the courts.

The U.S. Supreme Court on Friday curtailed Chevron deference, a legal policy of deferring to federal agencies when it came to interpreting and enacting laws.

That practice began in 1984 when the U.S. Supreme Court ruled in Chevron v. Natural Resources Defense Council to give broad power to federal agencies and bureaucrats on how to interpret and enforce laws by Congress.

Since then, Congress has at times passed very broad laws, leaving it up to federal regulators to work out the details and as a result giving essentially lawmaking power to the executive branch. In other instances, federal rulemakers overruled or reinterpreted federal law to fit their own agenda.

During the Obama administration, federal regulators developed its Waters of the United States (WOTUS) rule that determined that even tiny amounts of water were now under the control of the federal government, widely considered by critics an abuse of authority. The rule was challenged in court. Former President Donald Trump undid much of that rule expansion during his term, but Biden reinstated the expanded powers in 2022.

In a more recent example, the Biden administration announced it would redefine Title IX’s use of the word “sex” to include gender identity and sexuality. A law originally passed by Congress to protect women’s sports has been reinterpreted by regulators to apply much differently than Congress originally communicated.

“The elimination of Chevron deference will help restore the proper balance of responsibilities among the three branches of the federal government,” former general counsel for the Department of Transportation under the Trump administration and current Heritage fellow Steven G. Bradbury told The Center Square.

Bradbury said that agencies will be required to return to a previous era of rulemaking, where agencies were much more limited and subject to Congress.

“Independent judges will get the last word on the meaning and limits of federal statutes using traditional tools of statutory interpretation,” Bradbury said. “Agencies will have far less discretion to push the bounds of their regulatory authority through innovative or strained interpretations of law, as the Biden administration has been doing in the name of climate change policy. And Congress will be forced to do the hard work of legislating where there’s a perceived need to extend federal regulation into new areas or to meet new challenges."

In another recent example, the Biden administration earlier this year announced an indefinite pause on the approval of new natural gas exports. The administration argued the U.S. is already the world leader in this export and that climate concerns should be considered.

Critics said the ban would kill jobs and exceeded federal authority.

Judge James Cain Jr. of the Western District of Louisiana issued a preliminary injunction against the U.S. Department of Energy's ban on Monday, as The Center Square previously reported .

“President Biden’s pause of LNG exports was yet another politically motivated effort to appease the radical green groups who fund Biden’s campaign,” Daniel Turner, executive director of the energy workers advocacy group, Power the Future, told The Center Square. “So blinded by his political ambition, Biden’s decision has only weakened his position in key states like Ohio and Pennsylvania, while simultaneously making Vladimir Putin stronger and richer. This was a terrible and petty decision by a failing President that hurt the nation, its energy independence, and his own electoral hopes … Luckily our courts have yet again set things straight.”

Biden’s ban in this regard followed a similar pattern, significantly expanding the interpretation of a past law to enact new powers.

The Biden administration has tried twice to forgive hundreds of billions of dollars in student loan debt in this manner only to be stopped by the courts. The second of those attempts is still under review but has been paused until a ruling can be made.

In another instance, the Biden administration announced a moratorium on evictions before the U.S. Supreme Court said it far exceeded the executive branch’s authority.

The majority wrote in the eviction ruling on Alabama Association of Realtors v. Department of Health and Human Services that the administration’s argument was a “wafer-thin reed on which to rest such sweeping power.”

“This claim of expansive authority … is unprecedented,” the ruling said. “Since that provision’s enactment in 1944, no regulation premised on it has even begun to approach the size or scope of the eviction moratorium. And it is further amplified by the CDC’s decision to impose criminal penalties of up to a $250,000 fine and one year in jail on those who violate the moratorium.”

Despite the recent pusbhack on federal regulatory power, the agencies still maintain substantial authority.

"The end of Chevron leaves in place many doctrines that will continue to encourage Congress to abdicate most of the serious work of governance to executive branch agencies. Chief among these is the non-delegation doctrine that permits Congress to give what is, in effect, legislative power to unelected officials. Nonetheless, the end of Chevron signals an important shift in direction,” Heritage legal expert Jack Fitzhenry told The Center Square. “Congress will be less able to rely on vague statutory language to avoid political responsibility for complex policy judgments. More generally, the decision is further evidence of the Court’s salutary return to enforcing the separation of powers envisioned in the first three articles of the Constitution."