In June, the U.S. Supreme Court took a big step toward limiting the discretion of federal agencies to impose economically or politically significant regulations without the clear authority of Congress.
The immediate impact of the case affects the electrical power generation industry, but the Supreme Court’s decision will likely cause federal agencies to pare back some of their regulatory ambitions that affect a broad array of industries, including agriculture.
THE CLEAN POWER PLAN
The case, West Virginia v. EPA, involved a challenge to the Obama administration’s Clean Power Plan. The Clean Power Plan, which was never implemented, was a Clean Air Act regulation that would have authorized EPA to impose limits on carbon dioxide and other greenhouse gases (GHG) emitted by electricity providers.
At issue in the case was if the Clean Air Act authorized EPA to take such sweeping action to address GHG emissions. Congress had never specifically directed EPA to make rules addressing GHG emissions at power plants.
However, in the rulemaking, EPA relied on broad language that provided general authority for EPA to regulate air pollution emissions from power plants. The Clean Power Plan’s detractors argued reliance on general congressional authority wasn’t enough when EPA’s plan could cost billions of dollars. The Supreme Court agreed.
BROAD VERSUS SPECIFIC
Federal agency rulemaking requires all regulations must trace their authority back to an act of Congress. However, Congress’ laws vary in terms of the level of specificity it provides to federal agencies that implement the laws. But, Congress often provides broadly worded directions (e.g., promote food safety).
The Supreme Court’s decision in West Virginia v. EPA will clamp down on regulations based on general congressional authority rather than clear directions from Congress. The majority held that if a regulation addresses matters of “vast economic or political significance,” or a “major question,” then there must be “clear congressional authorization” for the agency to act.
FUTURE FARM IMPLICATIONS
It will likely take several similar cases to refine what constitutes a “major question” or “clear congressional authorization,” but it is clear the conservative-leaning Supreme Court is charting a course to rein in federal agencies. This will have implications for environmental and other forms of regulations facing farmers and ranchers.
The decision will also put more emphasis on the specificity of language passed by Congress. If you’re active in farm organizations or trade associations, this will mean working with legislators to obtain specific, sought-for language to be included in legislative text.
No stranger to dirty boots, John Dillard, an attorney with OFW Law, focuses his practice on agricultural and environmental litigation.
