Rulemaking is one of the functions of administrative agencies. When the legislature deals with areas in statutes where expertise is required, it delegates the lawmaking function to administrative agencies. An administrative agency’s rules can be categorized as legislative rules, interpretive rules, procedural rules, and general statements of policy.
Legislative rules are also known as substantive rules because the rules created have substantial impact on people to whom the rule applies.[i] Legislative rules have the force and effect of law and can be enforced. These rules have binding effect on all individuals and courts. A legislative rule does not leave the agency free to exercise discretionary power.[ii] Legislative rules also impose fresh rights and obligations on public.[iii] A legislative rule is an integral part of a statute.
For certain rules to be valid, they should be published in the federal register after inspection by the public. 44 USCS § 1505 states that certain proclamations, executive orders, documents having general applicability and legal effect, and documents required to be published by Congress should be published in a federal register. According to Federal Register Act, a rule should be published in the federal register after public inspection of the rule. If no public participation is allowed, publication in the federal register will not make the rule valid.[iv]
Administrative rules that have the backing of a criminal sanction will have the effect of law.[v] Rules that continue for a long period of time without any interference from legislature are deemed to have received approval of the legislature and will be treated as binding law. Federal and state courts give legislative rules effect of law if the rules made are reasonable, recognized by Congress, published in the federal register, and conform to certain procedural requirements.
Agency policy statements operate as a guide to an administrative agency’s exercise of discretion.[vi] Agency policy statements are not enforceable because they are flexible. A policy statement of an administrative agency does not have a binding effect. An agency’s general statement of policy differs from a legislative rule because a policy statement is neither a rule nor a precedent. A policy statement merely announces to the public the policy which the agency hopes to implement in future adjudication.
An administrative agency creates interpretative rules to clarify or explain existing laws or regulations. An interpretative rule does not create a new law or modify existing ones.[vii] An interpretative statement indicates an agency’s understanding of a statute.[viii] Administrative agencies create interpretative rules when there is confusion and disagreement over the meaning of a statute and when the ambiguity should be clarified. Interpretative rules have no binding effect over federal and state courts.[ix]
Informal pronouncements made by administrative agencies such as agency’s internal directives to its employees, opinion letters, enforcement guidelines, and interpretive bulletins cannot be enforced in federal and state courts. An agency manual which only acts as a guide or advisory document is also not enforceable. Agency protocols and procedures do not have the effect of agency rules, and therefore, cannot be enforced. These documents only have a persuasive authority and are not binding on federal and state courts. Courts can use their discretionary power to accept or reject an agency’s general policy statements.
Administrative agencies are bound to abide by their internal rules according to Accardi doctrine.[x] An administrative agency is bound to follow its own rules, procedures and precedents. Any deviation from this requires reasonable explanation. Agencies should follow their procedural rights to limit discretionary actions.[xi]
Valid administrative rules have the force and effect of a statute. The general rule that every person is presumed to know the law is applicable in the case of administrative rules.
[i] Williams v. Van Buren, 117 Fed. Appx. 985 (5th Cir. Tex. 2004)
[ii] Community Nutrition Institute v. Young, 818 F.2d 943 (D.C. Cir. 1987)
[iii] Citizens for Better Forestry v. United States Dep’t of Agric., 481 F. Supp. 2d 1059 (N.D. Cal. 2007)
[iv] 44 USCS § 1507
[v] Universal Sanitation Corp. v. Trade Waste Comm’n, 940 F. Supp. 656 (S.D.N.Y. 1996)
[vi] Home Builders Ass’n of Chester & Del. Counties v. Commonwealth, 828 A.2d 446 (Pa. Commw. Ct. 2003)
[vii] Paralyzed Veterans of Am. v. West, 138 F.3d 1434 (Fed. Cir. 1998)
[viii] First Nat’l Bank v. Sanders, 946 F.2d 1185 (6th Cir. Tenn. 1991)
[ix] Professionals & Patients for Customized Care v. Shalala, 847 F. Supp. 1359 (S.D. Tex. 1994)
[x] United States ex rel. Accardi v. Shaughnessy, 347 U.S. 260 (U.S. 1954)
[xi] Wilkinson v. Legal Servs. Corp., 27 F. Supp. 2d 32 (D.D.C. 1998)