The US Supreme Court has been taking aim at the administrative state for some time. With its opinion in Loper Bright, the Court has eliminated Chevron deference, meaning courts will no longer defer to an agency’s reasonable interpretation of an ambiguous statute.

The result will shift power from the executive branch to the judicial branch. But, though substantial, the decision represents less of a sea change than a shift in the prevailing wind, one that can and will be navigated by regulatory agencies. The ramifications for the legislative branch are less clear but arguably at least as important.

Judiciary and executive / The ruling allows judges to decide if an agency’s interpretation is the best reading of the statute. Some legal observers suggest this will create chaos as each of the 10 circuits will inevitably make some inconsistent decisions—at least in the short term—creating uncertainty unwelcome by those who must comply with regulatory requirements. Compounding the problem is that judges are not always in a good position to address technically complex regulatory issues, a rationale that harkens to the need for expertise that regulatory agencies possess.

Aside from creating uncertainty, Loper Bright will likely increase the number of judicial challenges as well as judicial invalidation of rules. In the former case, the Supreme Court’s ruling this term in Corner Post may allow revisitation of old cases upheld on deference grounds, despite the majority’s opinion in Loper Bright that its decision is prospective and not retrospective. In the case of judicial invalidation of rules, a 2017 study found that agencies prevailed 75 percent of the time under Chevron, and less so under other standards of deference: so-called Skidmore deference (56 percent), in which deference is based on the agency’s ability to support its position, or de novo review (39 percent), which grants no deference to agency decision making.

It is worth noting that, at least in recent years, higher courts have employed Chevron deference less and less in making their decisions. Former OIRA administrator Cass Sunstein foresees “a nontrivial increase in judicial invalidations of regulations to protect health, safety, and the environment … [and] a significant increase in ideological divisions in the lower courts” (Sunstein 2024).

As for the executive branch, we can expect agencies to more clearly explain their reasoning in anticipation of future review by the courts, and some administrative law experts observe that this has already been occurring in anticipation of the invalidation of Chevron. We can also expect fewer 180-degree turns in defending a rule after a partisan shift in the White House because agencies must now stick with the best interpretation of a statute. A particular challenge will arise when agencies might employ an old, ambiguous statute to address a modern problem (such as the regulation of artificial intelligence or space); agencies will be less likely to break new ground.

People have long criticized the increasing delegation of legislative authority to agencies. Rep. Virginia Foxx (R–NC), chair of the House Education and Workforce Committee, observed:

Congress creates, enables, and abides by the administrative state when it passes statutory language without clear meaning. Congress’ illegal delegation of its Article I authority … to unaccountable bureaucrats … has been a fault of this body over decades and the fault of both parties.

Congress/​ In response to Loper Bright, Congress could amend the Administrative Procedure Act and clarify the kind of review courts should apply. Two very different proposals have already been offered, reflecting the ideological divisions that often arise on regulatory matters. One, sponsored by several conservative Republicans and called the Separation of Powers Restoration Act, would enshrine a de novo standard of review. Another, sponsored by several progressive Democrats and called the Stop Corporate Capture Act, would codify Chevron deference into law. The latter may prove to be unconstitutional as Justice Clarence Thomas suggested in his Loper Bright concurrence.

Lacking a “clean” fix by amending the APA, Congress will likely attempt to draft new statutes more clearly, but this may be difficult for issues that are still developing or where political consensus is lacking. Congress may also need more expertise to grapple with the complexities of particular subjects; punting such issues to agencies may no longer be the default option it often is today. Finally, Congress can be expected to draft more specific delegation of interpretive authority to agencies when writing new statutes.

Less clear is what Congress can do about delegations contained in old statutes, which provide the basis for nearly all the 3,000-plus regulations promulgated every year. Lawmakers most certainly will not slog through hundreds of statutes and amend them one by one. The issue is one of oversight: What is the best way for Congress to ensure an agency is acting within its intended delegated authority?

H.R. 8204, cosponsored by Reps. Don Davis (D–NC), Tim Burchett (R–TN), and Guy Reschenthaler (R–PA), would require an agency to notify Congress when beginning a new rulemaking process and explain the necessity of the rule: Is it required by statute, is it necessary to interpret a statute, or has it been made necessary by a compelling public need? (See Belton 2024.) An agency would also have to clarify that it considered alternatives to regulation and discern if existing law contributes to the underlying problem the rule is intended to address. Each notice would be sent to the Government Accountability Office, which would include it in a publicly searchable database and report to Congress on agency compliance with the law.

By obtaining this information long before the promulgation of a proposed rule, Congress would have an opportunity to use its oversight powers. The information would be part of the administrative record that a court would see in its review of whether an agency acted within the authority Congress delegated to it and make regulators more accountable to the legislative branch. That would be a good thing, no matter the standard of deference.

Readings

  • Belton, Keith B., 2024, “Rationales for New Regulation,” Regulation 47(2): 4–6.
  • Sunstein, Cass R., 2024, “The Consequences of Loper Bright,” working paper, July 1.