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Guidance (administrative state)

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Guidance is a term in administrative law used to describe a variety of documents created by government agencies to explain, interpret, or advise interested parties about rules, laws, and procedures. Guidance documents clarify and affect how agencies administer regulations and programs. However, they are not legally binding in the same way as rules issued through one of the rulemaking processes of the Administrative Procedure Act (APA).[1][2][3]

Because they are not rules, guidance documents are not typically subject to the Congressional Review Act (CRA). However, the Government Accountability Office determined in 2017 that some guidance documents qualify as rules under the CRA and APA. See this section of the article for more information.[4]

Types of guidance include interpretive rules, policy statements, and contemporaneous guidance. Guidance comes in many forms, including memoranda, notices, bulletins, directives, news releases, letters, and blog posts.[2][5]

Background

The Administrative Procedure Act (APA) of 1946 established two standardized rulemaking procedures for legally binding regulations: formal and informal. Both processes require agencies to seek public input on proposed rules and to publish proposed and final regulations in the Federal Register. Agency guidance documents are exempt from APA rulemaking requirements and as such are not legally binding. However, guidance documents clarify and affect how agencies administer regulations, laws, and programs. Because guidance documents are exempt from the procedural requirements of the APA, they can be issued at any time and without an opportunity for public comment.[1][2][3]

The Regulatory Group, a private consulting firm that advises government officials and businesses on the federal regulatory process, claims that, "In most agencies, the volume of guidance material usually far exceeds the volume of legally enforceable regulations."[1] Guidance comes in many forms, including memoranda, notices, bulletins, directives, news releases, letters, and blog posts.[5] Guidance documents are not typically collected in federal publications such as the Federal Register or the Code of Federal Regulations.[6]

Types of guidance

The Administrative Conference of the United States (ACUS), an independent federal agency that develops recommendations to improve administrative processes, has described the following types of guidance:[1][2][3]

  • Guidance in the form of documents explaining an agency regulation or an agency's interpretation of a statute (also known by the term interpretive rule)
  • Guidance in the form of guidelines, manuals, staff instructions, opinion letters, and press releases (also referred to as a policy statement)
  • Guidance issued at the same time as an administrative rule in the form of official summaries of final rules and notes, examples, and appendices contained within the language of rules (also known as contemporaneous guidance)

Sample guidance document

Below is a sample guidance document:

Congressional actions related to guidance

Guidance Clarity Act

U.S. Senator James Lankford (R-Okla.) in March 2021 introduced a bill in the Senate called the Guidance Clarity Act. The legislation, which did not pass the 117th Congress, would have required “federal agencies to state on the first page of guidance documents that such guidance (1) does not have the force and effect of law, and (2) is intended only to provide clarity to the public about existing legal requirements or agency policies.”[7]

During the 118th Congress, Sen. Lankford reintroduced the bill in the U.S. Senate on January 26, 2023. Rep. Blaine Luetkemeyer (R) introduced the bill in the U.S. House of Representatives on June 30, 2023.[8][9]

Guidance documents classified as rules by the Government Accountability Office

See also: Congress votes to repeal an agency guidance document for the first time

The Government Accountability Office (GAO), an independent agency contracted and supervised by Congress, has issued various reports and determinations related to federal agency guidance documents.

Based on study requests from Senator Pat Toomey (R-Penn.), the GAO determined in 2017 that two agency guidance documents were rules subject to the Congressional Review Act (CRA). The CRA requires agencies to submit rules to Congress and the GAO for review. Once a rule is submitted, Congress and the president have 60 legislative days (days that Congress is actually in session) to pass a resolution repealing the rule and barring the agency from creating a similar rule in the future. Guidance documents are not typically part of this process. However, the GAO determined that the following guidance documents were rules on October 19 and December 5, 2017, respectively:[4][10][11]

According to an article from the law firm White & Case LLP, these determinations from GAO leave agencies with several options: "submitting the [guidance] to Congress, issuing similar new guidance as a rule that would be submitted to Congress for CRA review, or abandoning the [guidance] altogether in favor of an alternative approach."[14]

Guidance Out of Darkness Act (GOOD Act)

U.S. Senator Ron Johnson (R-Wis.) and Representative Mark Walker (R-N.C.) in January 2018 introduced companion bills in Congress called the Guidance Out of Darkness Act or GOOD Act in the 115th Congress. The legislation would have required the following: "On the date on which an agency issues a guidance document, the agency shall publish the guidance document on the Internet website of the agency." Agencies would have been required to have a single, public website location for all their guidance documents and to maintain online copies of any canceled documents.[5][15][16]

During the 117th Congress, Sen. Johnson reintroduced the GOOD Act in the U.S. Senate on March 9, 2021. Rep. James Comer (R-Ky.) reintroduced the GOOD Act in the U.S. House of Representatives on March 8, 2021. The bills did not pass the 117th Congress.[17][18]

During the 118th Congress, Sen. Johnson reintroduced the GOOD Act in the U.S. Senate on March 14, 2023. Rep. Comer reintroduced the GOOD Act in the U.S. House of Representatives on February 9, 2023.[19][20]

Presidential administrations on guidance

George W. Bush and Barack Obama (2001-2017)

Executive Order 13422: OIRA review of guidance documents

In 2007, President George W. Bush (R) issued Executive Order 13422. It required agencies to send significant guidance documents (guidance associated with an economically significant rule) to the Office of Information and Regulatory Affairs (OIRA) for review. Bush's order also tasked regulatory policy officers with ensuring that their agencies comply with that provision.[21][22][23] This order was withdrawn by Bush's successor, President Barack Obama (D), on January 30, 2009, under Executive Order 13497. Obama's order did not state a reason for revoking Bush's policies.[24]

The progressive think tank and regulatory advocacy group OMB Watch (later the Center for Effective Government) said in a press release supporting Obama's revocation that Bush's E.O. 13422 "further politicized the regulatory process and threatened to prevent regulatory agencies from setting new standards that protect the public."[25][26] The Competitive Enterprise Institute, a free-market think tank, later characterized Bush's E.O. 13422 as "a modest effort to restore some of E.O. 12291’s rigor." E.O. 12291 instituted President Reagan's regulatory review regime, later revoked and replaced by President Clinton's E.O. 12866.[27]

Donald Trump

November 2017: DOJ issues memo prohibiting guidance with regulatory effects

Under President Donald Trump (R), the U.S. Department of Justice (DOJ) changed some of its policies on agency guidance documents and regulatory enforcement. According to a press release from the DOJ, on November 17, 2017, Attorney General Jeff Sessions "issued a memo prohibiting the Department of Justice from issuing guidance documents that have the effect of adopting new regulatory requirements or amending the law. The memo prevents the Department of Justice from evading required rulemaking processes by using guidance memos to create de facto regulations. ... Under the Attorney General’s memo, the Department may no longer issue guidance documents that purport to create rights or obligations binding on persons or entities outside the Executive Branch."[28][29]

The press release went on to note that Associate Attorney General Rachel Brand would lead the department's regulatory reform task force in reviewing existing guidance documents and recommending changes and repeals.[28] The following month, the DOJ announced that it would rescind 25 guidance documents it had found to be outdated or contrary to the new policy.[30]

On January 25, 2018, Associate Attorney General Brand issued another policy memo implementing and further specifying Sessions' 2017 memo. Brand's memo, titled "Limiting Use of Agency Guidance Documents In Affirmative Civil Enforcement Cases," ordered DOJ officials involved in civil enforcement to avoid giving agency guidance the same authority as legally binding rules. The memo read in part:[31]

“

Guidance documents cannot create binding requirements that do not already exist by statute or regulation.

Accordingly, effective immediately for ACE [affirmative civil enforcement] cases, the Department may not use its enforcement authority to effectively convert agency guidance documents into binding rules.

Likewise, Department litigators may not use noncompliance with guidance documents as a basis for proving violations of applicable law in ACE cases.

The Department may continue to use agency guidance documents for proper purposes in such cases. For instance, some guidance documents simply explain or paraphrase legal mandates from existing statutes or regulations, and the Department may use evidence that a party read such a guidance document to help prove that the party had the requisite knowledge of the mandate.

However, the Department should not treat a party's noncompliance with an agency guidance document as presumptively or conclusively establishing that the party violated the applicable statute or regulation. [32]

”
—U.S. Department of Justice (2018)[31]

The New York Times reported on February 10, 2018, that a variety of agencies could be affected by these policy changes. The Centers for Medicare and Medicaid Services, the Environmental Protection Agency, the Food and Drug Administration, and the Department of Health and Human Services were given as examples of agencies that frequently use guidance to establish violations of the law and justify enforcement actions.[33]

July 2018: Trump administration rescinds 24 guidance documents, affecting race as a consideration in higher ed admissions

The Trump administration rescinded 24 guidance documents in July 2018 that had been issued under the Obama administration. The documents included guidance from the U.S. Department of Education (DOE) encouraging institutions of higher education to consider race as a factor in the admissions process as a means to achieve student diversity. The DOE guidance provided legal recommendations and contextual examples for schools considering race as a component of the admissions process.[34][35][36]

The decision to rescind the DOE guidance documents occurred in light of an investigation launched by the U.S. Department of Justice in the summer of 2017 regarding allegations that Harvard University discriminated against Asian-American applicants by holding them to a higher standard than other applicants.[35][37]

Attorney General Jeff Sessions announced the decision to rescind the guidance documents on July 3, 2018. In his announcement, Sessions stated that the DOE and other agencies are required to adopt new regulations through the rulemaking process, which provides members of the public with the opportunity to offer feedback on proposed rules during public comment periods. He discouraged the agency from implementing regulations through guidance documents, which are issued by agencies in order to explain, interpret, or advise interested parties about rules, laws, and procedures:[34]

“ The American people deserve to have their voices heard and a government that is accountable to them. When issuing regulations, federal agencies must abide by constitutional principles and follow the rules set forth by Congress and the President. In previous administrations, however, agencies often tried to impose new rules on the American people without any public notice or comment period, simply by sending a letter or posting a guidance document on a website. That's wrong, and it's not good government.[34][32] ”


Click "show" to the right on the table below to view the complete list of rescinded guidance documents:[36][38]


Theory and practice

Why and how agencies use guidance

Quoted in March 2018 by the Government Executive news site, law professor Nicholas Parrillo argued that the use of guidance documents benefits both agencies and regulated parties:[39]

“

Nicholas Parrillo, a Yale University Law professor, who conducted 135 interviews with regulatory experts for the Administrative Conference of the United States, said, 'It was clear from these interviews that guidance increases an agency program’s integrity and efficiency and shields regulated parties against unequal treatment, unnecessary work, and unnecessary risk.'[39][32]

”

The Regulatory Group has argued that agencies tend to use guidance documents because they are easier to issue than regulations and allow agencies to respond more quickly than the rulemaking process typically allows:[1]

“ There are several reasons for the wide use of guidance. In most situations, it is much easier to issue guidance than a regulation. Guidance does not have to be published for public comment ... and in most agencies it does not have to be approved at as high a level as regulations. Thus, when questions arise about the meaning of a regulation or about acceptable methods of complying with a regulation—and such questions arise constantly—the easiest way for an agency to respond is by issuing guidance. Guidance is frequently issued as a result of pressure from the regulated public who insist on more specific direction than the regulation contains.[32] ”
—The Regulatory Group[1]

When agencies treat guidance as legally binding

According to the Administrative Conference of the United States (ACUS), agency officials sometimes use guidance documents in ways that give those documents the same authority as legally binding rules. In a 1992 recommendation, the ACUS explained how it believed this practice could affect the rights of regulated parties:[3]

“ Where the policy statement is treated by the agency as binding, it operates effectively as a legislative rule but without the notice-and-comment protection of section 553 [of the Administrative Procedure Act]. It may be difficult or impossible for affected persons to challenge the policy statement within the agency's own decisional process; they may be foreclosed from an opportunity to contend the policy statement is unlawful or unwise, or that an alternative policy should be adopted. Of course, affected persons could undergo the application of the policy to them, exhaust administrative remedies and then seek judicial review of agency denials or enforcement actions, at which time they may find the policy is given deference by the courts. The practical consequence is this process may be costly and protracted, and affected parties have neither the opportunity to participate in the process of policy development nor a realistic opportunity to challenge the policy when applied within the agency or on judicial review.[32] ”
—Administrative Conference of the United States[3]


The Regulatory Group has claimed that although agencies often give their guidance documents the same effect as enforceable regulations, most guidance is not issued or enforced with the intent of avoiding the APA rulemaking process:[1]

“ Virtually every agency states clearly that its guidance material is just that—a guide—and is not intended to be binding. While this may be true as a technical matter—because to be binding a regulation must be issued after notice-and-comment rulemaking—some agencies give their guidance a great deal of practical effect. Indeed, in the hands of many Federal field office employees, guidance material often becomes indistinguishable from enforceable regulations. ...


Most guidance is issued to answer questions, not because the agency is deliberately attempting to skirt the rulemaking requirements. Similarly, the fact that an agency’s field staff treats guidance material as if it were 'mandatory' is more a result of a large and scattered bureaucracy than it is deliberate.[32]

”
—The Regulatory Group[1]


William Funk, a law professor and the author of several books on administrative and environmental law, claimed in a 2011 book review that he and 10 other legal scholars agreed that agencies should be able to issue guidance documents but that they sometimes abuse that ability. Funk wrote:[40]

“ [We all agree] that agencies must be able to issue certain interpretations and policy statements, generically guidances, without having to follow the notice-and-comment process applicable to legislative rules. On the other hand, everyone also agrees that agencies can abuse the ability to avoid notice and comment rulemaking through invocation of the exceptions for 'interpretative rules' and 'general statements of policy.' How to police the line between those rules requiring notice and comment and those that do not is what has stymied courts and commentators.[32] ”
—William Funk (2011)[40]


The list of law professors that Funk was referring to included Robert Anthony, Peter Strauss, Elizabeth Magill, Nina Mendelson, Donald Elliott, Jacob Gersen, Ronald Levin, John Manning, David L. Franklin, and Mark Seidenfeld.[40]

Regulatory dark matter

Regulatory dark matter is a term coined by policy analyst Clyde Wayne Crews Jr. to describe, in his words, "executive branch and federal agency proclamations and issuances such as memoranda, guidance documents, bulletins, circulars, announcements and the like with practical if not always technically legally binding regulatory effect."[41][42] Crews is critical of what he calls regulatory dark matter because he believes agencies sometimes use these proclamations and issuances to impose practical requirements, set policy- and decision-making priorities, and take other actions that exceed the intent of Congress or avoid federal rulemaking procedures.[43]

See also

External links

Footnotes

  1. ↑ 1.0 1.1 1.2 1.3 1.4 1.5 1.6 1.7 The Regulatory Group, "Regulatory Glossary," accessed August 23, 2017
  2. ↑ 2.0 2.1 2.2 2.3 Administrative Conference of the United States, "Guidance in the Rulemaking Process," June 10, 2014
  3. ↑ 3.0 3.1 3.2 3.3 3.4 Administrative Conference of the United States, "Recommendation 92-2: Agency Policy Statements," June 18, 1992
  4. ↑ 4.0 4.1 The Regulatory Review, "Guidance and the Congressional Review Act," February 15, 2018
  5. ↑ 5.0 5.1 5.2 Forbes, "An Inventory of Federal Agency Guidance Documents," March 20, 2018
  6. ↑ Washington Post, "Trump’s team has detected the ‘dark matter’ of government regulation, meaning you ain’t seen nothing yet," February 1, 2017
  7. ↑ Congress.gov, "S.533 - Guidance Clarity Act of 2021," accessed December 7, 2022
  8. ↑ Congress.gov, "H.R.4428 - Guidance Clarity Act of 2023," accessed August 28, 2023
  9. ↑ Congress.gov, "S.108 - Guidance Clarity Act of 2023," accessed August 28, 2023
  10. ↑ Government Accountability Office, "Applicability of the Congressional Review Act to Interagency Guidance on Leveraged Lending," October 19, 2017
  11. ↑ Government Accountability Office, "Applicability of the Congressional Review Act to Bulletin on Indirect Auto Lending and Compliance with the Equal Credit Opportunity Act," December 5, 2017
  12. ↑ Federal Reserve, "Interagency Guidance on Leveraged Lending," March 21, 2013
  13. ↑ Consumer Financial Protection Bureau, "CFPB Bulletin 2013-02," March 21, 2013
  14. ↑ JD Supra, "Banking Regulators Signal Movement Away from Leveraged Lending Guidance," March 19, 2018
  15. ↑ E&E Daily, "GOP frets over agency compliance with Congressional Review Act," March 15, 2018
  16. ↑ Congress.gov, "H.R.4809 - Guidance Out Of Darkness Act," accessed October 25, 2018
  17. ↑ Congress.gov, "S.628 - GOOD Act," April 8, 2021
  18. ↑ Congress.gov, "H.R.1605 - To increase access to agency guidance documents.," April 8, 2021
  19. ↑ Congress.gov, "S.791 - GOOD Act," accessed August 28, 2023
  20. ↑ Congress.gov, "H.R.890 - Guidance Out Of Darkness Act," accessed August 28, 2023
  21. ↑ Brookings Institution, "The President's New Executive Order on Regulation," January 31, 2007
  22. ↑ Barilleaux, R. & Kelley, C. (2010). The Unitary Executive and the Modern Presidency. College Station: Texas A&M University Press.
  23. ↑ Center for Effective Government, "Agency Regulatory Policy Officers," July 20, 2007
  24. ↑ Benton Foundation, "Obama Revokes Bush Executive Orders Concerning Regulatory Planning And Review," February 17, 2009
  25. ↑ Federal Register, "Executive Order 13497, Revocation of Certain Executive Orders Concerning Regulatory Planning and Review," January 30, 2009
  26. ↑ Center for Effective Government, "OMB Watch Applauds Obama's Revocation of Bush-Era Executive Order on Regulatory Review," February 4, 2009
  27. ↑ Competitive Enterprise Institute, "Channeling Reagan by Executive Order," July 14, 2016
  28. ↑ 28.0 28.1 U.S. Department of Justice, "Attorney General Jeff Sessions Ends the Department’s Practice of Regulation by Guidance," November 17, 2017
  29. ↑ U.S. Department of Justice, "Attorney General Sessions Delivers Remarks at the Federalist Society 2017 National Lawyers Convention," November 17, 2017
  30. ↑ Lexology, "Practitioner Insights: Is Agency Guidance the Low-Hanging Fruit for Regulatory Reform?" March 23, 2018
  31. ↑ 31.0 31.1 U.S. Department of Justice, "Limiting Use of Agency Guidance Documents In Affirmative Civil Enforcement Cases," January 25, 2018
  32. ↑ 32.0 32.1 32.2 32.3 32.4 32.5 32.6 Note: This text is quoted verbatim from the original source. Any inconsistencies are attributable to the original source.
  33. ↑ The New York Times, "Administration Imposes Sweeping Limits on Federal Actions Against Companies," February 10, 2018
  34. ↑ 34.0 34.1 34.2 CNN, "Trump administration reverses Obama-era guidance on use of race in college admissions," July 3, 2018
  35. ↑ 35.0 35.1 The Wall Street Journal, "Trump Administration to Rescind Obama Guidelines on Race in College Admissions," July 3, 2018
  36. ↑ 36.0 36.1 U.S. Department of Justice, "Attorney General Jeff Sessions Rescinds 24 Guidance Documents," July 3, 2018
  37. ↑ The Wall Street Journal, "Court Filings Detail Role of Race in Harvard Undergraduate Admissions," June 15, 2018
  38. ↑ Quartz Media, "Jeff Sessions doesn’t want Americans to read these 24 government documents anymore," July 5, 2018
  39. ↑ 39.0 39.1 Government Executive, "GOP Lawmakers Fault Agencies for Issuing Too Much Guidance," March 14, 2018
  40. ↑ 40.0 40.1 40.2 William Funk, "The Dilemma of Nonlegislative Rules," June 3, 2011
  41. ↑ SSRN, "Mapping Washington's Lawlessness: A Preliminary Inventory of Regulatory Dark Matter (2017 Edition)," February 18, 2016
  42. ↑ Competitive Enterprise Institute, "Regulatory Dark Matter," accessed October 2, 2017
  43. ↑ National Review, "It's Time to Shine a Light on Regulatory 'Dark Matter,'" February 20, 2017
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