Supreme Court’s Ruling in Arlington v. FCC Highlights Debate Over the Meaning and Future of Chevron Deference Doctrine in Administrative Law

In today's column, I analyze a significant administrative law case handed down by the U.S. Supreme Court earlier this week, City of Arlington, Texas v. Federal Communications Commission (FCC). Arlington v. FCC is an extremely interesting decision in that it has many of the trappings of an important Supreme Court ruling-a divided (5-1-3) Court, a dissent (by the Chief Justice) proclaiming a "fundamental" disagreement with the majority, a majority opinion expressing concern that the dissenters want to radically rewrite an area of law-and yet close inspection is required to get a meaningful sense of the space between the different positions staked out by the Justices in the case.

Background of the Case and the Majority's Application of Chevron Deference

The dispute in Arlington involves the process for locating and constructing wireless communication towers. The federal Telecommunications Act of 1996 places meaningful limits on the power that state and local governments would otherwise enjoy, under, for example, land-use and zoning regulations, to impede the installation and modification of such towers. The Act also imposes procedural requirements on states and localities; in particular, it requires state or local government to respond to a wireless service provider's application to construct a tower "within a reasonable period of time after the request is duly filed." In the decade-plus since the Act was adopted, companies in the wireless industry have felt that state and local governments have been taking too long to process tower construction requests, and so industry representatives asked the FCC to provide clarity as to what "reasonable period of time" means. The FCC, using its general powers to implement the provisions of the 1996 law, issued a ruling to the effect that state and local governments should ordinarily process applications within 150 days (and even fewer days for some kinds of applications.)

State and local governments, including the City of Arlington, Texas, challenged this FCC rule on the ground that the FCC did not have authority to interpret the term "reasonable period of time." Instead, contended the challengers, ambiguity in this term could be interpreted and resolved by courts only. The United States Court of Appeals for the Fifth Circuit rejected the challenge, holding that Congress did not clearly resolve what "reasonable period of time" meant, and that in light of this textual uncertainty, the FCC's interpretation of that term was entitled to deference under the famous 1984 administrative law case of Chevron v. Natural Resources Defense Council, which holds that certain agency interpretations of statutes are to be upheld so long as they are reasonable and permissible readings, even if they are not the interpretations that courts would embrace in the first instance. In other words, under Chevron, certain, minimally plausible, agency interpretations of ambiguous statutes carry the day, even if courts, confronted with the questions anew, would find those interpretations to be less convincing than other interpretations.

Arlington took the case to the Supreme Court and argued that Chevron deference to agency interpretations makes sense in many settings, but not, as here, where the agency has interpreted a provision "that concerns the scope of the agency's statutory authority (that is, its jurisdiction.)" More specifically, the challengers of the FCC ruling contended that Chevron deference is not appropriate as to "jurisdictional" questions concerning "the who, what, where and when of regulatory power." Rather, deferring to agency interpretations of statutes is warranted under Chevron only when the agency's power to regulate in a particular area has already been determined, and the question is how the regulation will be undertaken.

On Monday, the Supreme Court spoke, and the majority in Arlington emphatically and repeatedly rejected this proffered distinction, between an agency's "jurisdiction" to regulate (as to which Arlington said no deference should be accorded the agency's reading of the statute), and the agency's decisions about how to regulate (as to which interpretive deference would still apply.) Justice Scalia's majority opinion (joined by Justices Thomas, Ginsburg, Sotomayor and Kagan) said this distinction is based on a "misconception" and a "premise [that is] false," and labeled the distinction "an empty distraction," "mental acrobatics," and a "mirage." According to Justice Scalia, "[n]o matter how it is framed, the question a court faces when confronted with an agency's interpretation of a statute it administers is always, simply, whether the agency has stayed within the bounds of its statutory authority." There is no difference between questions of how the agency regulates, and questions of when, where and as to whom the agency regulates.

Instead, wrote Justice Scalia, as long as an agency is given by Congress the general power to administer a statute through the promulgation of rules and the resolution of disputes, and as long as the meaning of the statutory provision in question has not been definitively resolved by Congress, the agency is entitled to deference as to how to interpret and apply the provision. Indeed, Justice Scalia argued, to embrace the distinction the challengers advocated would be to pull the Court one large step down the path of dismantling the Chevron deference idea altogether. And since the majority had no desire to take such a step, it upheld the Fifth Circuit's decision to afford the FCC's interpretation of the term "reasonable period of time" substantial deference.

The Concurring and Dissenting Justices' Views

Justice Breyer agreed with some of what Justice Scalia said, and he concurred in the majority's bottom line-that the Fifth Circuit should show deference to the FCC in this case-but Justice Breyer wrote separately to emphasize that he thought more factors should be considered before deference is appropriate. Justice Breyer found relevant not just the FCC's general power to administer the Act and the ambiguous nature of the term "reasonable period of time" (the two factors most prominent in Justice Scalia's analysis), but also that the decision of how much time it should reasonably take to process an application to build or modify a wireless tower involves detailed knowledge of the industry, such that the FCC's expertise in this field would assist in giving intelligent meaning to the statutory language. And he found nothing in the larger statutory framework that suggested any countervailing reason to be distrustful of FCC interpretive power here.

Chief Justice Roberts, joined by Justices Kennedy and Alito, dissented. Although they did not identify particular reason to be wary of FCC interpretive power in this setting in particular, they expressed deep concern about giving agencies too much interpretive power generally. Indeed, the most interesting and important aspect of the dissent (and perhaps the entire case) was the dissatisfaction the dissenters expressed with the modern administrative state. They described how, today, administrative agencies "as a practical matter . . . exercise legislative power, . . . executive power . . . and judicial power. . ." , and that the "accumulation of these powers in the same hands is not an occasional or isolated exception to the constitutional plan[, but rather] a central feature of modern American government." Echoing some of the rhetoric used by a majority of Justices to reject the Commerce Clause as a basis for Congress's enactment of the Affordable Care Act, the dissenters registered their belief that "the Framers could hardly have envisioned today's vast and varied federal bureaucracy and the authority administrative agencies now hold over our economic, social and political activities."

The dissenting Justices also lamented how difficult, for practical and other reasons, it is for the President to keep watch over an ever-growing and increasingly active army of federal bureaucrats-"with hundreds of federal agencies poking into every nook and cranny of daily life." And they worried about the breadth of agency discretion that Congress creates when it passes laws directing the executive branch to regulate "in the public interest" or for such other, equally grandiose but equally undefined, purposes. In this brave (my term, not theirs) new world, the dissent observed, a citizen "confronting thousands of pages of administrative regulations" might "perhaps be excused for thinking that it is the agency really doing the legislating."

In light of Congress's delegation of basic, essentially legislative, policy decisions to the executive branch, and given the President's inability or disinclination to meaningfully oversee all of the alphabet soup of federal agencies, the dissenters were fearful of construing Chevron deference too broadly, because doing so would reduce the power of the courts to rein in agencies.

The dissenters agreed with the majority that when a statutory provision is ambiguous, and when Congress has given the agency the power to interpret that statutory provision in particular, courts should defer to agency interpretations; the dissenters thus purported not to want to cut back on the core of Chevron deference. But the dissenters would insist that, before deference is given, there be a demonstration not simply that Congress gave the agency the general power to administer the statute as a whole, but rather that Congress gave the agency the power to interpret the specific provision at issue. Usually (maybe almost always), Congress's conferral of general power to administer a statute would support a finding that Congress intended to confer power to the agency to interpret the relevant substantive or procedural provision at issue, but the dissenters apparently can envision situations in which an agency is given general power to administer a statute, but not the power to interpret at least some of the statute's particular provisions. The dissenters didn't know that to be the case for the FCC and the statutory provision at issue in this dispute, but they would remand to the Fifth Circuit to at least ask and answer the question of whether Congress intended the FCC to be able to interpret the "reasonable period of time" provision in particular, before deference to the agency's understanding of that term is afforded.

How Deep Is the Disagreement Between the Majority and Dissent?

Only time will tell whether the schism between the majority and the dissenters in Arlington portends bigger battles over Chevron deference, one of the main pillars of modern administrative law. Even the (unusual trio of) dissenters do not defend the "jurisdictional/non-jurisdictional" line that Arlington had advanced. But they do propose a different and potentially important line-between Congress's creation of agency power to implement a statute generally and Congress's decision to give the agency power to interpret any specific provision in particular. It might be a rare case in which Congress has given to an agency the power to administer a statute generally but seems not to have given the agency the power to interpret all the meaningful, ambiguous, provisions therein-and I say "seems" here because if Congress has made clear its intent to withhold agency power to interpret any particular statutory provision, even the majority would respect that desire-but that is where we may see future skirmishes. And note that, although the majority does not seem interested in pursuing the dissenters' invitation to look at each statute provision by provision-and instead prefers a bright-line approach-there is nothing in the majority ruling, notwithstanding some of its broad language, that completely forecloses the possibility of finding that a particular ambiguous provision in another statute in a future case does not warrant Chevron deference, notwithstanding an agency's general power to administer that statute; Arlington could be easily distinguished in such a later case on the ground that there was nothing in the Telecommunications Act that undercut an inference that Congress intended the FCC to have the power to interpret the "reasonable period of time" provision alongside other substantive provisions. (Indeed, that was one of the big points in Justice Breyer's concurrence.)

So the different approaches taken by the majority and the dissent in Arlington may not end up mattering in many real or hypothesized cases. But there does seem to be a meaningful difference concerning the extent to which the majority and the dissent are comfortable with the Chevron regime at a more basic level. For the majority, as dangerous as giving agencies broad interpretive power under Chevron may be, it is better than giving judges leeway to pick and choose when to defer to agencies and when not to. Judges are even less politically accountable than are agencies, and more prone to generating disuniform interpretations of statutes based on ad hoc judgments. According to the majority: "The excessive agency power that the dissent fears would [absent a strong Chevron deference doctrine] be replaced by chaos."

Maybe there is something to commend this categorical preference for agencies over courts-and make no mistake, that is what Chevron deference is. In this regard, it is worth noting that the majority in this case that favors broad agency interpretive power is comprised of both "liberal" and "conservative" Justices; when Justices of different ideologies agree on a contentious issue, there is often something good to be said about the arguments they find persuasive. But courts do have one advantage over agencies; if a court misinterprets the meaning of a congressional statute, Congress can in theory amend the statute more easily than it can if an administrative agency misinterprets the statute (under a regime where a court is bound to defer to that misinterpretation.) Any attempt by Congress to rein in an overly aggressive agency interpretation might be met with a threat of a Presidential veto. The fact that the executive branch wears many hats (involved in lawmaking, law applying and law interpreting) complicates efforts by Congress to keep it in bounds. In this respect, the instinct of the dissenters that broad delegations of power to the executive branch are particularly scary (and maybe more so than even broad delegations of powers to the judiciary) is an important one to consider and keep watch on in the future. This is especially true in light of, as the dissenters put it, "the dramatic shift in power over the last 50 years from Congress to the Executive."

Cross-posted from Justia's Verdict.