Judge Manry believes there is a big problem with the way nonrule policy is defined. The law says agency policy is either policy-by-rule or nonrule policy. Policy-by-rule is policy that applies to everyone, while nonrule policy is policy that doesn’t apply to everyone. However, the courts have a different definition and say that nonrule policy is any policy that hasn’t been officially approved. This means that some policy-by-rule is being labeled as nonrule policy, which is causing confusion. Before recent changes to the law, rules that hadn’t been officially approved didn’t have to be approved in order to be enforced in court. This became known as the “prove-up exception to rulemaking.” There’s still a debate about what agency policies need to be approved as rules. Judge Manry questions the traditional interpretation of early cases and offers an alternative view. The article uses humor to talk about the issue and is written from Judge Manry’s perspective. It’s like a funny story about unpromulgated rules being disguised as nonrule policy. The first mention of this “disguise” was in a court case called O. McDonald v. Department of Banking and Finance in 1977. Administrative agencies have been relying on this “disguise” for a long time. The kingdom had three rulers who shared power equally. The first ruler made laws, the second ruler interpreted the laws, and the third ruler enforced them. The third ruler also appointed agencies to help carry out the laws. One of these laws, called Ch. 120.2 The APA, was meant to help agencies. The agencies used a scarecrow to confuse people about the rules for over 20 years. People were determined to understand the rules better. The people in the kingdom knew that agency policy had to follow the rules set by the ruler. If the policy was part of the rules, it was called policy-by-rule. If it wasn’t, it was nonrule policy. The agency had to give notice before taking any action based on either type of policy. This was important for fairness. If the agency didn’t give notice, their action wouldn’t count.
The agency had to follow specific procedures to give notice of policy-by-rule. These rules were like laws and had to be followed. Unpromulgated rules are rules that were not officially made and are not enforceable. Agencies didn’t like having to go through the process of making rules because it was expensive and took a long time. They found a loophole and started disguising their unpromulgated rules as nonrule policy. This made the rules enforceable, even though they weren’t officially made. Agencies were trying to save their good policy from being ignored, but it was a tricky situation. Government agencies found a way to get around making formal rules by using tricky definitions. They got approval from the courts to make policies without following the normal rules. This made it easier for them to enforce their policies without having to go through the usual process. Over time, this became a common practice and was called the “prove-up exception” to rulemaking. It was like a scarecrow that was seen everywhere in the kingdom. Farmers and rulers had trouble figuring out what counted as a rule or nonrule policy, but eventually, they decided it didn’t really matter as long as the outcome was fair. They also found a loophole called the “prove-up exception” that let them enforce unpromulgated rules if they could prove they were reasonable and accurate. One ruler didn’t like this loophole, but the other ruler thought it was okay. So, in the end, they were still figuring things out. The first ruler believed that fair procedures were just as important as fair results in administrative fairness. They changed a rule to make sure that all policies had to go through proper procedures before being put into place. They also made sure that nonrule policies only applied to new and emerging issues, not existing rules. The McDonald farm didn’t like a strict definition of rules that required all agency policy to be made into rules. They believed that policy should only become a rule when it affected everyone and was important enough. They also thought that agency policy should be based on clear standards and should be applied the same way to similar situations. The government agreed and made a law to make sure that agency policy only became a rule when it met certain criteria. This law tried to balance the need for good policy and making sure everyone knew the rules. Section 120.57(1)(e) and 120.56(4)(e) required agencies to follow certain rules when making policies that affect people. But these rules were so complicated that even lawyers didn’t agree on them. So, the government made new rules to make things clearer, and everyone was happy. Daniel Manry is an administrative law judge who has a lot of experience in tax law. He’s written a column for the Administrative Law Section, and he wants to make sure that the law is fair and just.
Source: https://www.floridabar.org/the-florida-bar-journal/the-scarecrow-in-mcdonalds-farm-a-fairy-tale-about-administrative-law/
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