Notice & Comment

How Agencies Communicate: Wrapping-Up, by Susan Morse and Leigh Osofsky

The Administrative Procedure Act and the question of judicial deference to agency action may be at the center of the typical Ad Law course syllabus. But they are far from the main topics in the story of How Agencies Communicate uncovered in this symposium. Rather than studiously following the notice and comment process to produce final regulations eligible for Chevron deference, the agency communications explored this week operate at the margins of or outside of the APA and judicial deference.

Nick Parrillo’s post, which builds from work with the ACUS, is a good place to start. Here we are reminded that the project of agency guidance is like a big iceberg with notice-and-comment rulemaking at the top. Below, there are individual phone calls, FOIA-able letters, more senior sign-off on advice, and perhaps eventually something public, such as a letter or FAQ posted on an agency website. The final regulation is at the top of a very large body of communication tactics – perhaps the kind that gets the most deference, but also the kind that demands the biggest investment of agency resources.

As other posts describe, the agency often communicates in informal ways that mimic our own social media habits. Elizabeth Porter and Kathryn Watts describe how agencies have used various types of visual media to develop support for regulatory agendas. They give, as an example, the Obama administration’s whiteboard video explaining the technical content of an EPA regulation. This kind of tool is so powerful that Michael Herz argues that agencies communicate something precisely when they do not use these channels. He explores how agencies’ reduced use of puffery on social media under the Trump administration has helped communicate a deregulatory agenda.

So, isn’t more communication better? We found ourselves cheering for the CFPB, which recently awarded itself a virtual birthday cupcake and announced that it has spent “Six years serving you.” Context is important of course, but when we find something in the iceberg that we think is of high quality, let’s say thank you and pay attention, as Kevin Stack suggests that we do for Preambles to regulations (which, he argues, should merit particularly high status as a form of guidance, since these also emerge from notice-and-comment).

And yet, as much as we might welcome all these different forms of communication, there is a problem. The problem is that agencies can affect regulated parties’ decisions with the least sliver of guidance. It may not matter to the audience whether APA procedure applies or what level of judicial deference is available. We gave the example of an abruptly released IRS advisory that conditioned a property tax deduction on the receipt of a property tax bill. In the advisory, the IRS took a reasonable view of the law, but it is not the only possible view. Taxpayers could take a more aggressive position. But, in general, taxpayers won’t. In other words, usually there will be no judicial review of these types of informal agency communications. Even if the guidance could be challenged, if often isn’t, and there we are, with agencies shaping behavior through the underwater part of the iceberg.

This is what concerns Kristin Hickman in her entry on interim-final and temporary regulations. If these receive Chevron deference, but do not go through APA procedures, they appear to occupy the privileged tip of the iceberg. She argues that this kind of guidance ought to go through notice and comment before it is effective and that a post-promulgation notice and comment process is not adequate. But would it be much better if the agency did the same things through guidance that did not even purport to claim Chevron deference? Wouldn’t regulated parties still listen to that guidance?

Andy Grewal examines how sometimes regulated parties are listening quite carefully, even when agencies don’t necessarily want them to. Agency officials may not be trying to communicate with the public when they create various guidance, such as internal IRS letters known as chief counsel advice. They may just be trying to communicate with each other. And, yet, even knowledgeable members of the public may carefully follow and rely upon their every word.

Aaron Nielson explains the puzzle more generally: We do listen, even if the tentativeness of an agency’s communication or its lack of legal status means that we perhaps should not place so much weight on what the agency says.

This symposium turns our attention to an important subject in administrative law: communications not clearly addressed by the APA and often not policed by judicial review. These communications raise a deep tension and tradeoff between having an effective government and having a government whose power can be monitored and limited. To what extent do agency practices and regulated party choices lie below the surface and protections contemplated by formal law?

Susan Morse is the Angus G. Wynne, Sr. Professor in Civil Jurisprudence at Texas Law and Leigh Osofsky  is a professor of law at the University of Miami School of Law.

This post is part of a symposium entitled How Agencies Communicate. You can read all the posts here.

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