THE ADMINISTRATIVE STATE AND SEPARATION OF POWERS IN WISCONSIN.

• Author: Hagedorn, Brian

INTRODUCTION

The administrative state in Wisconsin has undergone drastic changes since 2010. Two developments are primarily responsible. First, Governor Scott Walker and the Republican legislature--elected in the Tea Party wave of 2010--enacted a number of modifications to the administrative rules process that have altered the legal landscape. (1) Second, the judiciary has increasingly been asked to step in and address legal issues related to the administrative state, a development due in part to political polarization and the rise of divided state government after the 2018 election. (2)

This essay focuses first on the significant transformation in judicial doctrines of deference to interpretations of law by Wisconsin agencies. Then, I provide a brief overview of several recent cases addressing the administrative state and the associated jurisprudential debates on our court. Finally, I conclude with some thoughts on the path ahead.

1. THE END OF AGENCY DEFERENCE

   While federal courts continue to grapple with various deference principles, Wisconsin has proceeded on a very different path. Our own administrative procedure act prescribes that "due weight shall be accorded the experience, technical competence, and specialized knowledge of the agency involved, as well as discretionary authority conferred upon it." (3) Over time, and in view of this statute (although not in strict reliance on it), the Wisconsin Supreme Court began to develop a three-tiered approach to reviewing the legal conclusions of state agencies. (4)

   At the highest level, where an agency's specialized expertise and technical competence grounded a longstanding interpretation of the law, courts gave that interpretation "great weight" deference. (5) This meant courts deferred to an agency's interpretation as long as it was reasonable, even if the court found another reading more reasonable. (6)

   On the other hand, where a legal question was within an agency's expertise and administrative responsibilities, but was less well-established or grounded in the unique capabilities of that agency, it was given a more modest "due weight" deference. (7) Under this approach, an agency's interpretation would govern unless the reviewing court found another interpretation more reasonable. (8)

   Finally, if the question was one of first impression or an agency's expertise or experience did not give it unique insight, courts would give no deference to an agency's reading of the law. (9) The standard of review was purely de novo. (10)

   Several observations are noteworthy. First, unlike in federal courts, this system of deference did not employ ambiguity as a threshold question. (11) Rather, the entire system was predicated on agency expertise with an eye toward uniformity and consistency in the way agencies administered a statutory scheme. (12) Second, this three-tiered scheme was highly malleable. (13) The degree of statutory expertise could be in the eye of the beholder, which made the rubric less predictable. (14) And in the real world, this line-drawing often had little practical significance. (15) For example, the Wisconsin Supreme Court opined in 2009 that due weight deference and no deference often resulted in the same outcome because the court would engage in a serious construction of the statute under both standards of review--a task it apparently did not do when great weight deference was invoked. (16)

   In 2017, however, the Wisconsin Supreme Court invited the parties, in a standard case reviewing an agency decision, to address the proper role of deference to state agencies. (17) In a split opinion, the court jettisoned this longstanding three-tiered approach altogether. (18)

   Two justices argued that "only the judiciary may authoritatively interpret and apply the law in cases before our courts." (19) This, they stated, is a core judicial power that the executive may not invade and "the judiciary may not cede." (20)

   Three other justices agreed that ending our policy of deference was appropriate. (21) They expressed alarm, however, with the reach of the two-justice opinion's broad constitutional declarations. (22) Instead, they maintained that since our deference doctrines were simply judicial creations, they could be rescinded in the same manner. (23) What the judiciary giveth, the judiciary can taketh away. There was no need to dive into the unique constitutional role of the judiciary, they argued, lest that analysis extend into and unknowingly upend other areas of law. (24) In their view, restraint was the better course. (25)

   Several months following this decision, the legislature amended Wisconsin's administrative procedure act and codified this no-deference approach. (26) The law now states: "Upon review of an agency action or decision, the court shall accord no deference to the agency's interpretation of law." (27)

   With all the debate nationally over judicial deference, Wisconsin provides an interesting laboratory both for how a change in deference can happen, and to what long-term effect. Based on my own short-lived experience with this change, its practical effect on the administrative state is unclear. Under the prior scheme, courts often applied due weight or no deference in cases with high stakes and those raising novel questions. Thus, the most acute impact moving forward should be felt in cases where longstanding agency interpretations are overturned by courts. And although not unheard of, these cases are rare. On a positive note, this overdue change has had the salutary effect of centering briefing on the text of the relevant law rather than on how much relevant expertise an agency has or whether a proffered agency interpretation is reasonable. It also may be that the most significant effects will involve how agencies do their jobs, rather than how courts review their work. When agencies know their interpretations of law can be reviewed in court and will be afforded no special treatment, it stands to reason that agencies will be less likely to stretch the law to achieve policy goals. Rather, they have a built-in...