Trump Track: Chevron Deference - Whose Ox Is Gored?

Federal courts often rely on "Chevron deference" in upholding regulations issued pursuant to vague congressional authorization. This doctrine dictates that where the statutory language is unclear, a court will defer to a reasonable interpretation of the language by the agency designated to enforce the statute. Agencies are not prone to reading their authority narrowly, and for decades, conservatives, including those on the Supreme Court, have chafed at the courts' reliance on that deference to expand government regulation.

With a new conservative majority on the court, and increasing numbers in the lower courts, the demise of the Chevron doctrine has been a frequent prediction in judicial writings. However, the Trump administration is now facing an uncomfortable fact that may slow, if not prevent, that demise.

The Trump administration has had a laser focus on reversing regulatory efforts by the prior administration. However, in order to justify the elimination or replacement of regulations proposed or duly promulgated under the preceding administration, it will almost inevitably be required to rely on that same Chevron deference to support its own decisionmaking – thereby restricting agency authority to interpret regulations by asking that courts defer to it.

At oral argument last week before the D.C. Circuit, the Trump administration faced a particularly difficult dilemma when attempting to eliminate proposed Obama regulations under the Comprehensive Environmental Response and Liability Act (CERCLA or Superfund) related to financial responsibility in the hardrock mining sector.

Section 108(b) of CERCLA, passed in 1980, required that EPA prioritize industries by risk. For those industries designated as particularly risky, it required the agency to promulgate financial responsibility regulations. Despite the directives in the statute, EPA had not proposed such regulations for any class of industry for over two decades. Environmentalists sued, and the D.C. Circuit ordered the agency to make a determination on whether regulation was required for the hardrock mining industry. Following that ruling, EPA proposed regulations for the industry in 2016.

The need for such regulation is controversial, both in terms of the need for such regulation at all – the industry asserts that it is already subject to comprehensive financial responsibility regulation in the states – and in some particulars, such as a formula for natural resource damages. The formula produced substantial estimates for potential financial responsibility, where in practice claims have usually been at or close to $0, although on rare occasion have exceeded $100MM. But rather than modify the regulations, the Trump Administration has declined to issue them, resulting in new litigation. This led to DOJ arguing before the D.C. Circuit for adoption of the agency's current view of the statute – that such federal regulation of the hardrock mining industry was not required at all. The DOJ attorney was quoted as saying "We are in a world of Chevron under this statute."

This was not the first time, and will not be the last, that the administration finds itself in this position. The ironic result may be that we will close out the Trump administration with Chevron deference in disarray as courts refuse to grant deference to 180-degree changes in agency positions, or the doctrine may be more firmly in place than ever.