Applicability of APA Notice and Comment Procedures to Revocation of Delegation of Authority ( 2001 )

Applicability of APA Notice and Comment Procedures to
Revocation of Delegation of Authority
The Secretary of Commerce may revoke a delegation to the Director of the Census without submitting
the revocation to the notice and comment procedures of the Administrative Procedure Act, notwith-
standing the fact that the Secretary voluntarily elected to follow those procedures in issuing the
delegation.
February 14, 2001
MEMORANDUM OPINION FOR THE ACTING GENERAL COUNSEL
DEPARTMENT OF COMMERCE
You have asked whether the Secretary of Commerce (“Secretary”) must com-
ply with the notice and comment provisions of the Administrative Procedure Act
(“APA”), 5 U.S.C. § 553 (1994), in order to revoke his delegation of authority to
the Director of the Census to make the final determination on the methodology to
be used in calculating the tabulations of population reported to the States and
localities under 13 U.S.C. § 141(c) (1994). See 65 Fed. Reg. 59,713, 59,716
(2000) (to be codified at 15 C.F.R. § 101.1). The regulation at issue also establish-
es an executive steering committee, composed of employees of the Bureau of the
Census, which is to prepare a report to the Director of the Census recommending a
methodology. Id. § 101.1(b). Although we have found no case definitively
establishing the proposition, we believe that the Secretary may revoke this
delegation of authority, including the establishment of a steering committee,
without submitting the revocation to the notice and comment procedures of the
APA.
Section 553(a)(2) of the APA, which generally requires rulemaking to provide
for notice and comment, “applies, according to the provisions thereof, except to
the extent that there is involved—a matter relating to agency management or
personnel . . . .” An internal delegation of administrative authority, such as the one
in 15 C.F.R. § 101.1(a) vesting authority in the Director of the Census, does not
adversely affect members of the public and involves an agency management
decision that is exempt from the notice and comment rulemaking procedures of the
APA. See United States v. Saunders, 951 F.2d 1065, 1068 (9th Cir. 1991)
(delegations of authority have “no legal impact on, or significance for, the general
public,” and therefore “simply effect[] a shifting of responsibilities wholly internal
to the Treasury Department”); Lonsdale v. United States, 919 F.2d 1440, 1446
(10th Cir. 1990) (“APA does not require publication of [rules] which internally
delegate authority to enforce the Internal Revenue laws”); United States v.
Goodman, 605 F.2d 870, 887-88 (5th Cir. 1979) (unpublished delegation of
authority from Attorney General to Acting Administrator of the DEA did not
violate APA); Hogg v. United States, 428 F.2d 274, 280 (6th Cir. 1970) (where
99
227-329 VOL_25_PROOF.pdf 109 10/22/12 11:10 AM
Opinions of the Office of Legal Counsel in Volume 25
taxpayer would not be adversely affected by the internal delegations of authority
from the Attorney General, APA does not require publication). The portion of the
regulation that provides for a committee, composed of Census Bureau employees,
which makes a recommendation to the Director of the Census, 15 C.F.R.
§ 101.1(b), is also an internal delegation of the Secretary’s statutory authority
under 13 U.S.C. § 141(c) to determine the methodology to be used in calculating
the tabulations. Therefore, like subsection (a) of 15 C.F.R. § 101.1, it is an internal
rule relating to agency management, ordinarily exempt from the notice and
comment rulemaking procedures of the APA.
Despite the statutory exemption in 5 U.S.C. § 553(a)(2), the Secretary elected
to comply with the notice and comment provisions of the APA in issuing this
delegation. See 65 Fed. Reg. 38,370-71 (2000) (proposed rule and commentary);
65 Fed. Reg. 59,713-16 (2000) (comments and responses, final rule); 65 Fed. Reg.
73,643 (2000) (final rule effective). The question here is whether the promulgation
of a new rule revoking the Secretary’s delegation must also comply with the notice
and comment procedures of the APA. 1 Because a rule regarding the Secretary’s
delegation or reservation of his authority is a matter of internal management that is
exempt from the notice and comment provisions of the APA, the Secretary is not
required to follow the notice and comment procedures for later delegations or
revocations of delegations, unless his decision to submit the original delegation of
authority to the APA process is a waiver of the applicability of the exemption to
future delegations of this nature. 2
We have found no support for the proposition that the Secretary, having volun-
tarily complied with the APA notice and comment provisions in promulgating a
particular rule, but expressing no commitment to do so in the future, must continue
to comply with those provisions in the issuance of later rules affecting the existing
one. To be sure, there is a line of cases holding that an agency that has waived the
exemption found in section 553(a) of the APA is required to comply with the APA
procedures in rulemaking as long as the waiver is effective. See, e.g., Buschmann
v. Schweiker, 676 F.2d 352, 356 n.4 (9th Cir. 1982) (policy statement requiring
HHS to use notice and comment provisions of APA acts as a waiver of exemp-
tion); Rodway v. U.S. Dep’t of Agriculture, 514 F.2d 809, 814 (D.C. Cir. 1975)
(USDA regulation making procedural requirements of section 4 of the APA
1
We note that, although validly promulgated regulations have the full force and effect of law,
Rodway v. United States Dep’t of Agriculture, 514 F.2d 809, 814 (D.C. Cir. 1975), section 101.1 may
not even be enforceable as to the Secretary. 3 Jacob A. Stein et al., Administrative Law § 13.03[2]
(2000) (“The rule [that a valid regulation has the force and effect of law] does not apply to agency
violations that are intended to regulate internal agency procedures rather than to protect any interest of
the objecting party.”). Cf. Garner v. Jones, 529 U.S. 244, 256 (2000) (court presumed, in a case
involving an internal rule that affected the rights of prisoners, that an agency follows its internal
policies) (citing Accardi v. Shaughnessy, 347 U.S. 260, 266-68 (1954)).
2
We are aware of no law that otherwise requires regulations published in the Code of Federal
Regulations to be repealed or revoked only by notice and comment.
100
227-329 VOL_25_PROOF.pdf 110 10/22/12 11:10 AM
Applicability of APA to Revocation of Delegation of Authority
applicable to all of its rulemaking relating to benefits bound the agency to comply
thereafter with the notice and comment procedures of the APA). However, in these
cases, the agency had issued a valid rule committing itself to following the notice
and comment provisions of the APA. Id. The courts’ holdings, therefore, rest on
the principle that an agency is bound to follow validly issued administrative
regulations. Id. Here, the Secretary has made no such commitment, either infor-
mally or formally. On the contrary, the regulation itself expressly provides that:
Nothing in this section diminishes the authority of the Secretary of
Commerce to revoke or amend this delegation of authority or
relieves the Secretary of Commerce of responsibility for any deci-
sion made by the Director of the Census pursuant to this delegation.
15 C.F.R. § 101.1(a)(5).
To require the Secretary to use a notice and comment process in repealing or
amending section 101.1 plainly would “diminish[]” his authority to dictate the
management processes of his Department. Subsection (a)(5) was added in
response to a comment that expressed concern that section 101.1 would divest the
Secretary of his statutory responsibility, and, in the words of the Secretary, was
intended to “erase any doubt that the delegation of authority is not a divestiture of
obligations or responsibility by the Secretary.” 65 Fed. Reg. at 59,715. The
additional text was intended to make explicit “that nothing in the rule diminishes
the authority of the Secretary of Commerce to revoke this delegation of authori-
ty . . . .” Id. 3 Moreover, binding agencies to continue to comply with the APA’s
notice and comment procedures with respect to rules for which they have voluntar-
ily sought public comment, but which do not affect even the procedural rights of
persons outside the agencies, might actually discourage them from seeking the
public’s view because of a reluctance to limit their future flexibility to amend or
repeal such a rule. We believe, therefore, that the Secretary is free to issue a new
rule revoking his prior delegation without subjecting that rule to the notice and
comment procedures of the APA. Cf. Nolan v. United States, 44 Fed. Cl. 49, 57
n.5 (1999) (acknowledging that Secretary of Transportation’s internal memoran-
dum delegating authority to a subordinate without notice and comment may have
superseded the regulation reserving that authority to the Secretary until the next
3
The Secretary’s response to this comment also states that: “It is unassailable that a rule revoking
the delegation would be effective, if it satisfied the requirements of the Administrative Procedure Act
and other applicable legal standards.” Id. In light of both the overall context of the Secretary’s response
and his addition of the language found in subsection (5), we do not read this statement as a waiver of
the exemption provided under subsection (a)(2) of section 553. Rather, it appears to be a general
statement of the law, which is that any rulemaking by the Secretary must be consistent with the
provisions of the APA and other provisions of law. In this case, the rule falls within the APA’s
exemption for internal rulemaking and therefore is not subject to the notice and comment provisions of
the APA.
101
227-329 VOL_25_PROOF.pdf 111 10/22/12 11:10 AM
Opinions of the Office of Legal Counsel in Volume 25
annual issuance of that reservation in the Code of Federal Regulations). Although
the Secretary’s delegation of authority is now embodied in a valid regulation, the
APA does not require the issuance of rules relating to delegations of this sort to be
subject to notice and comment. 4
DANIEL L. KOFFSKY
Acting Assistant Attorney General
Office of Legal Counsel
4
At least as a prudential matter, we would suggest that any rule revoking or amending section
101.1 be published in the Federal Register. There is some authority for the proposition that a published
regulation, even if it is a delegation that would not ordinarily be required to be published, can only be
revoked by a published revocation. See Nolan, 44 Fed. Cl. at 58-59. This view is based on 44 U.S.C.
§ 1510(e) (1994), which provides that publication in the Federal Register and Code of Federal
Regulations of codified documents is prima facie evidence that they are in effect on and after the date
of publication, as well as the concept that a failure to publish notice of the change of policy could
adversely affect members of the public. Id. Although we do not believe that failure to publish a
revocation here would have an adverse impact on the public, publication of the revocation would
promote the notice function of the Federal Register and Code of Federal Regulations, upon which the
public relies.
102
227-329 VOL_25_PROOF.pdf 112 10/22/12 11:10 AM