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September 28, 1979
ROADS TO REFORM
Panel IV A. Revised Procedures
for Rulemaking and Adjudication: Improve Administrative Efficiency While Preserving Fairness? Remarks by Clark Byse
The question for discussion is, as the program states, "Can we improve administrative efficiency while preserving fairness?" My answer is I hope so. In any event, surely we must strive to do so. Perhaps, however, this is not the best way to phrase the question, for, as Roger Cramton wrote a few years ago, to appraise a procedure in terms of "'fairness', 'due process', and the like, suffers from undue generality, since the content of these value-laden words shifts from time to time and from person to person.
Dean Cramton then advanced the proposition that the "basic notion [is] that in a society committed to a representative form of government, private persons should have a meaningful opportunity to participate in government decisions which directly affect them, especially when governmental action is based on individual rather than on general considerations." He also suggested that beyond this basic idea of meaningful participation, "any evaluation of administrative procedures must rest on a judgment which balances the advantages and disadvantages" of the procedures in question. In striking this balance, rather than emphasizing "fairness" or "due
process", the evaluation should direct attention to the following considerations: "the extent to which the procedure
furthers the accurate selection and determination of relevant facts and issues, the efficient disposition of business, and, when viewed in the light of the statutory objectives, its acceptability to the agency, the participants, and the general public."
If the adjudication and rulemaking procedures of the Ribicoff (S. 262), Kennedy (S. 1291) and Administration (S. 755) bills are appraised in terms of the Cramton criteria of accuracy, efficiency and acceptability, what will be the appraisal?
Considering first, the "general hearing" [$201 (e), p. 26 et. seq.] and "expedited procedures" [$202(d) (1), p. 27 et. seq.] provisions of the Ribicoff and Administration bills--the Kennedy bill has no similar proposal--I am on the whole favorably impressed. One can--as, indeed, has been done today-criticize some aspects of these proposals, but in the main they are designed to make the practice more efficient and at the same time to provide for an accurate process.
Whether these procedures satisfy Dean Cramton's third standard of acceptability is more difficult to determine, for a judgment concerning acceptability is every bit as subjective and "value-laden" as a conclusion concerning "fairness". Accordingly, while I do not disregard the acceptability standard, I give. it less weight than the other two criteria. Or perhaps one may reason that a procedure which is both accurate and
efficient is or should be acceptable.
These proposals build on the sound proposition that procedures should be related to the character or nature of the question to be decided--a proposition already incorporated in the Administrative Precedure Act. Indeed, all or nearly all that is sought by these proposals could be achieved without any amendment of the APA. See the last sentence of section
556 (d) which provides that in "rule making or determining claims for money or benefits or applications for initial licenses an agency may, when a party will not be prejudiced thereby, adopt procedures for the submission of all or part of the evidence in written form." But since many, perhaps most, agencies have not used the authority given them by section 556 (d), the bills make use of the new procedures mandatory. In light of the agencies failure to use their 556 (d) powers, some coercion appears to be in order. Whether these bills apply too much coercion and whether their limitation of cross-examination is too extreme is not easy to state. I believe that only experience will provide answers to these questions.
If that experience demonstrates that these provisions reached the right balance, well and good. But what if experience indicates that the provisions went too far? The only remedy would appear to be amendatory legislation. But how likely is it that Congress would enact such legislation? the thirty years since enactment of the APA, its hearing provisions have not been amended. Should there not be some
mechanism or process short of full-scale statutory enactment which could rectify procedural misjudgments by Congress or by the agencies? I shall return to this point later. For the present, I repeat that I approve the conceptual basis which underlies the "general hearing" and "expedited procedures" proposals..
Turning now to the informal rulemaking provisions of the Administration (§201(a), p. 23 et. seq.] and Kennedy [$102, p. 3 et. seq.] bills--the Ribicoff bill has no similar proposals--the picture is more complicated.
The Administration bill proposes several changes in section 553. Generally speaking, those changes are intended to make the present section 553 requirements of notice, comment and concise general statement more detailed. They are not designed to require or encourage what has come to be known as "hybrid rulemaking". The Kennedy bill, on the other hand, is intended to encourage hybrid rulemaking with respect to a "significant" rule which is defined as a "rule or series of closely related rules which will result in an annual impact on the economy of $100,000,000 or more; or any other rule or series of closely related rules which the agency determines is likely to have an equally significant impact on the economy" [S101, p. 2]. In the case of a proposal for a significant rule, the agency:
[M] ay use either oral or written procedures
Whether one approves or disapproves these provisions will depend in part on one's assessment of Vermont Yankee. Those who believe that pre-Vermont Yankee judicial prescription of hybrid rulemaking was a desirable development will tend to approve the Kennedy bill proposals. This is so because although the bill provides that an agency may--not must--consider employing the listed hybrid procedures, it is likely that a court would review the agency's decision concerning utilization of the listed hybrid rulemaking procedures to determine whether the decision was arbitary or capricious or an abuse of discretion; and in exercising this reviewing function the court might substitute its judgment for that of the agency. It is true, of course, that a court might hold that Vermont Yankee precludes review except to determine whether there are "constitutional constraints or extremely compelling circumstances" which require hybrid procedures. Unless the matter is clarified by statutory language or rather