The National School Boards Association (NSBA) recently expressed its concerns over the Supreme Court’s recent landmark ruling in Perez v. Mortgage Bankers Association, which allows federal agencies to issue “interpretive rules” without going through the formal notice-and-comment procedures required for issuing formal administrative rules. The NSBA explained that it fears that federal agencies like the U.S. Department of Education (DOE) Office of Civil Rights (OCR) will use this authority to issue “Dear Colleague Letters” (DCLs) and other less formal guidance without giving NSBA and other stakeholders the opportunity to provide input before the rules take effect.
In Perez, the Supreme Court held that federal agencies may issue “interpretive rules” without subjecting those rules to the formal notice-and-comment procedures outlined in the Administrative Procedures Act (APA). Our colleague,Doug Hass, wrote an extensive analysis of the decision at his Wage and Hour Insights Blog that provides the relevant factual and legal background. As Hass pointed out, the decision essentially allows any federal agency to “flip flop” on critical interpretations of federal regulations without going through the time-consuming regulatory process. According to the Court, “[b]ecause an agency is not required to use notice-and-comment procedures to issue an initial interpretive rule, it is also not required to use those procedures when it amends or repeals that interpretive rule.” The decision may blur the line in the future between an agency interpreting a regulation and creating essentially an entirely new one through “interpretive rules.”
The NSBA expressed similar concerns. Specifically, the NSBA noted that Perez would allow OCR to exert substantial authority through DCLs and other informal guidance. While DCL are technically “interpretive,” they have significant implications on school districts that may have based their conduct on previous regulatory guidance. Under Perez, DCLs could essentially operate as new regulations and deny stakeholders the “seat at the table” they are currently afforded through the APA rulemaking process. As an example, the NSBA cited a recent DCL from OCR that the NSBA believes includes a misinterpretation of the American with Disabilities Act (ADA) as applied to requests for communication assistance for students with hearing, vision, or speech disabilities. The NSBA explained that under Perez, the letter may be an “interpretive rule” that would deprive the NSBA and other groups the chance to express their concerns during the notice-and-comment period. According to NSBA Deputy General Counsel Naomi Gittins, the Perez case makes clear that “the power has definitely shifted toward agencies.”