Chevron and preemption.

AuthorMendelson, Nina A.

TABLE OF CONTENTS I. INTRODUCTION II. SOME BACKGROUND ON CHEVRON AND PREEMPTION A. Chevron and Value-Based Interpretive Canons B. The Presumption Against Preemption 1. Agency Actions and Preemption 2. The Concerns of Preemption Doctrine III. AGAINST CHEVRON DEFERENCE ON PREEMPTION QUESTIONS A. Political Safeguards for States in Congress and the Agencies 1. Political Safeguards for States in Congress 2. Agency Incentives to Consider State Interests 3. State Opportunity to Participate in Agency Decisionmaking B. Agency Expertise on Preemption Questions C. The Risk of Arbitrary Decisionmaking and Tension with the "Rule of Law" D. Agency Self-Interest E. A Regime Without Chevron Deference IV. CONCLUSION I. INTRODUCTION

To one who values federalism, federal preemption of state law may significantly threaten the autonomy and core regulatory authority of states. (1) When an unelected federal agency official is the one interpreting the unclear federal statute, the potential threat to state autonomy may seem even greater. As the administrative state's authority has increased, however, agencies administer a substantial number of statutes that raise preemption issues, including statutes bearing on health care, banking, communications, and the environment, just to name a few. A statute may be unclear as to whether it preempts state law at all, or else the statute may contain language that expressly preempts state law, but the extent of that preemption may remain unclear.

Courts deciding that a statute preempts state law have defined the question largely as one of congressional intent. (2) At least since Rice v. Santa Fe Elevator Corp., (3) however, the Supreme Court has employed a presumption that state powers are not lightly to be superseded. Apparently motivated by a desire to protect state regulatory prerogatives and sovereignty, (4) the Court thus generally has required a "clear statement" or other strong evidence of a "clear and manifest purpose of Congress" before holding state law preempted. (5) On its own terms, the Rice presumption would seem to apply to any interpretation of a statute's preemptive effect, perhaps even where an administrative agency has rendered the first interpretation.

Meanwhile, the doctrine of Chevron v. Natural Resources Defense Council calls generally for judicial deference to agency statutory interpretations. (6) Unless Congress has clearly answered the question at hand, Chevron instructs a court to defer to the agency's reasonable interpretation of a statute it administers. (7) The Chevron doctrine does not expressly take account of state interests. Instead, Chevron presumes that Congress has implicitly delegated interpretive authority to the agency because it is more expert and more politically accountable than the courts. Given Chevron's application even to "pure questions of law," (8) where one might expect courts to be the experts, there might seem little reason to distinguish questions of state law preemption.

When faced with an agency interpretation addressing a statute's preemptive effect, courts have trod unevenly in reconciling Chevron deference with the Rice presumption against preemption. (9) Within a single case, Smiley v. Citibank (South Dakota), N.A., (10) for example, the Supreme Court assumed without deciding that courts should resolve de novo the threshold question whether a federal banking statute preempted state law, notwithstanding a federal agency interpretation--but then paid Chevron deference to the agency interpretation of a single word in the statute: "interest," despite arguments that the agency interpretation effectively broadened the statute's preemption of state law. Elsewhere, the Court, citing Chevron, has claimed to accord "substantial weight" to an agency's interpretation of a statute to preempt state law, but does not appear to have conducted the usual Chevron inquiry. (11) The lower appellate courts have wavered between applying only Chevron (12) and interpreting a statute de novo notwithstanding an agency interpretation, following Rice. (13)

Some scholars have argued that granting Chevron deference to agency interpretations regarding preemption is inappropriate because important questions of state sovereignty would be resolved by institutions that are not properly politically accountable. (14) Some Justices have expressed similar reservations about agency interpretations that "alter[] the federal-state framework," (15) or suggested that "agencies are clearly not designed to represent the interests of States." (16) The contrast is with Congress, whose members are elected from particular districts or states. The arguments founded on political accountability concerns, however, have been largely conclusory. They have included little in the way of detailed comparisons of the institutional structure of agencies and of Congress as they relate to the consideration of state interests.

This Article takes a more functional approach to reconciling preemption doctrine with Chevron when Congress has not expressly delegated preemptive authority to an agency, an approach that considers a variety of concerns, including political accountability, institutional competence, and related concerns. The Article assumes that federalism values, such as ensuring core state regulatory authority and autonomy, are important and can be protected through political processes. (17) It argues that although Congress's "regional structure" might hint at great sensitivity to state concerns, it actually may lead Congress to undervalue some federalism benefits that are more national in nature. Meanwhile, executive agencies generally have significant incentives to take state concerns seriously. Agencies are politically accountable through the President and also may wish to maintain cooperative relationships with states.

Although the political accountability of agencies for considering state interests is not significantly inferior to that of Congress, the Article argues that Chevron deference to agency interpretations of the preemptive effect of statutes is nonetheless inappropriate. An agency may expertly assess the extent to which a particular state statute interferes with the achievement of a federal goal. Other institutions, however, may better assess issues such as the overall distribution of governmental authority and the intrinsic value of preserving core state regulatory authority. In addition to institutional competence concerns, granting Chevron deference to agency preemption decisions may result in inadequately constrained decisionmaking processes. Finally, granting deference also might increase the risk that agencies would inappropriately expand their own authority at the expense of the states.

Instead, a preferable regime would not include Chevron deference. A court should retain not only the ability to apply the Rice presumption against preemption, but also the discretion to take account of an agency interpretation on preemption under a regime such as Skidmore v. Swift. (18) The court might do so when it views the interpretation as possessing particular "power to persuade" in view of, say, particular agency expertise. (19)

Reconciling the Rice presumption with Chevron has broader implications for statutory interpretation. The presumption against preemption is only one of a number of "value-based" or "substantive" canons of statutory construction that potentially conflict with Chevron. (20) Meanwhile, by reserving interpretive questions to the agencies with responsibility for administering the statute at hand, the Chevron doctrine suggests an institutional, rather than a substantive, solution to statutory ambiguity. Courts have yet to articulate a consistent framework to reconcile substantive canons with Chevron, leaving the status of the canons murky. (21)

Drawing in part on the reconciliation of the presumption against preemption with Chevron, this Article takes issue with the position of some scholars that courts should be able to use a substantive canon in preference to Chevron deference because the values of the canon are. in some measure, "important." (22) It argues for a more structured framework to reconcile substantive canons with Chevron. Such a structured framework should include examination of not only political accountability, but also legal accountability, institutional competence, and related concerns.

Part II presents some background on the rationales for both Chevron and the presumption against preemption. Part III seeks to offer a closer examination of political accountability--the issue on which most scholars have focused--and concludes that agencies, like Congress, may have significant incentives to take state interests into account. (23) Part III also considers questions of institutional competence, legal accountability, and agency self-interest. Part III concludes that Chevron deference is unwarranted, and attempts to assess the weaknesses of the alternative approach. Finally, Part IV concludes by considering the implications of this Article's framework for the tension between Chevron and value-based canons of statutory interpretation.

  1. SOME BACKGROUND ON CHEVRON AND PREEMPTION

    To better understand the stakes of a resolution of the tension between Chevron deference and the presumption against preemption, it is worth providing some additional background on each doctrine and its underlying rationale.

    1. Chevron and Value-Based Interpretive Canons

      Under the familiar rule of Chevron, unless Congress has directly answered the interpretive question at hand (as a court may conclude in "Step One"), a court must defer to an agency's reasonable interpretation of a statute it administers (in Chevron "Step Two"). (24) Chevron seems best read as resting on the notion of an implicit congressional delegation. The Chevron Court held that Congress can be assumed to have delegated interpretive authority to agencies in view of their superior policy expertise and...

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