Sneaky changes in administrative procedure

On RegBlog, Sam Saylor (Penn) has posted "Debt Ceiling Legislation Also Speaks to Administrative Law".

Despite all the attention the congressional debate over the debt ceiling received this summer, a section of the Budget Control Act of 2011 -- the controversial August 1st law that raised the ceiling at the last moment -- also contains a little-known but interesting administrative procedure quirk. It exempts certain Department of Education policies from a procedure known as negotiated rulemaking.

Title V of the legislation purports to save the government money by removing the interest rate subsidy for all federal government originated or guaranteed graduate-level student loans ....
    
Interestingly, the final section of Title V expressly exempts implementation of these student loan changes from negotiated rulemaking. The exemption is from a mandate, imposed on the Department of Education under 1998 amendments to the Higher Education Act, that ordinarily requires rules about federal student loans to be established using negotiated rulemaking.
    
When an agency follows the negotiated rulemaking process -- or what is also known as "reg neg" -- its proposed rule is developed through negotiation with affected parties, after which the agency proceeds with the ordinary notice-and-comment process. Reg neg procedures are highly touted as a more efficient and less adversarial way to craft administrative rules because representatives of interested groups are invited to negotiate with each other before the agency announces its proposal.
    
Research by Professor Cary Coglianese at the Penn Program on Regulation has shown that reg neg procedures consume considerable time and resources and do not reduce litigation over administrative rulemaking. "In the debt ceiling legislation, Congress appears to have implicitly acknowledged negotiated rulemaking's disadvantages," he said.

Go to the post for links to many of the documents and terms to which it refers. Two general lessons here.

First, changes in administrative procedures can be subtle, inserted into legislation in a manner that requires very careful reading. You can see with this example that it doesn't take many words to make a large change in how an agency does business.

Second, one cannot always determine the reason for a change from its language. Pace Prof. Coglianese (for whom I have the utmost respect and admiration), it is not impossible that Congress had reasons other than efficiency for dropping negotiated rulemaking in this case. One of the problems with negotiated rulemaking is that it facilitates agency capture. It leads to politically determined rules rather than rules written by the "agency experts". The interest groups, even all of those involved, may not reflect the common good. (Who selects which interest groups should be involved in the process?) And, once you come to rely on the interest groups to draft your rules, you don't need agency experts any more. (So, if this is the reason for judicial deference, is judicial deference justified any more? Are the courts deferring to interest groups rather than presumably interest-neutral agency experts? Should we set Chevron aside for rules created by negotiated rulemaking?)

I suspect we will never know the internal process in Congress that led to this change in agency procedure. Prof. Coglianese may be right. EMM