Chevron v. Natural Resources Defense Council
The Clean Air Act Amendments of 1977 Congress enacted requirements for states that had not achieved the national air quality standards established by the EPA. The Amendments required states to create permit programs for any "new or modified stationary sources" of air pollution. The EPA made a rule to implement this permit requirement, and in this rule they allowed states to adopt a plant wide definition of the term "stationary course." (This means that a plant would not have to meet the stringent permit requirements if the "alteration will not increase the total emissions from the plant.").
Is this a reasonable interpretation of the statute?
The Court of Appeals set aside these regulations. It reasoned that the text of the statute did not address this issue and the legislative history was "at best contradictory." Rather, it said that the purposes of the statute should "guide" their decision. Therefore, the Court of Appeals ruled that this law was "inappropriate" in programs enacted to improve air quality
"The basic legal error of the Court of Appeals was to adopt a static judicial definition of the term 'stationary source' when it had decided that Congress itself had not commanded that definition."
The court then says that courts must answer two questions when reviewing an agencies construction of a statute:
- "Is the question whether Congress has directly spoken to the precise question at issue?" If the intent is clear then the court and agency have to defer to Congress.
- If the intent is NOT clear then the court "does not simply impose its own construction on the statute, as would be necessary in the absence of an administrative interpretation. Rather, if the statute is silent or ambiguous with respect to a specific issue, the question for the court is whether the agency's answer is based on a permissible construction of the statute."
The court takes this approach because it believes that by Congress leaving a gap for the agency to fill, Congress has delegated to the agency the authority to "elucidate" the provision. "Such legislative regulations are given controlling weight unless they are arbitrary, capricious, or manifestly contrary to the statute."
Using this rationale the court then concludes that the interpretation of the statute that the EPA made is reasonable one.
The court then addresses if the EPA is allowed to change their interpretation of the word "source" when a new administration is elected and takes over an agency. The court rules that the initial interpretation of an agency is not "instantly carved in stone." The wisdom of decisions must be reconsidered on a continual basis.
The court then concludes with an explanation of why judges are not good at making these type of administrative decisions/interpretations and why this is better left to the other branches of government.