provisions of Section 4 of the Administrative The cases looking only at the impact of rules, and requiring notice and comment if the impact is substantial, have been criticized for creating unpredictability of review of agency decisions and for 102 departing from the APA. Recently the substantial impact test was explicitly rejected by the Court of Appeals for the D. C. Circuit as an independent 103 basis for determining the applicability of APA procedures. The court suggested that the test may be useful as one of the criteria for deciding whether an agency action was a policy statement or a 104 rule covered by the good cause exemption." The court concluded, however, that the test has no utility in distinguishing between interpretive and legislative rules because both types of rules may vitally affect private interests. 105 Rejection of the substantial impact test as an independent basis for requiring notice and comment in rulemaking covered by an exemption also may be compelled by the Supreme Court's 101/ Id. at 863. 2 K. Davis, 102/ See Asimow, supra note 80, at 556: Administrative Law Treatise SS 7:15-7:17, supra note 87, at 69–87. 103/ Cabais v. Egger, supra note 85, at 237-38. 104/ Id. at 237. For example, if what the agency labeled a policy statement had substantial impact on the rights or privileges of the public and, in fact, eliminated future agency discretion in making individualized decisions, then the court might conclude the agency's action was a legislative rule and not a policy statement. A substantial impact test also might be used in making the distinction between procedural and substantive rules. If what the agency calls a "procedural rule" in fact affects the rights or obligations of the public in significant degree, then the court could Vermont Yankee decision. One can speculate, however, that this development may have little practical significance for an agency deciding what procedures to follow in rulemaking. What may happen is that reviewing courts will give renewed attention to the distinction between interpretive rules and legislative rules. And if the agency has legislative rulemaking power, and the rule imposes obligations not clearly contemplated by the enabling statute, then the court is likely to conclude that the rule is legislative rather than interpretive. Therefore, the possiblity of reversal on judicial review should cause agencies to hesitate prior to labeling rules "interpretive rule" or "policy statements" and foregoing notice and comment. Even if the agency is confident that its rule falls within the "interpretive rule or policy statement" exemption, it should follow notice and comment procedure if the rule or statement will have a substantial impact on the public and there is no overriding reason for not following such procedure. This was the recommendation of 106 the Administrative Conference in 1976. The Conference's recommendation also stated that when it is necessary for agencies to make such rules and statements effective immediately, agencies should give the public the opportunity to submit post-promulgation 107 comments. f. Good cause exemptions. Sections 553(b)(B) and 553(d)(3) of the APA authorize agencies to dispense with public participation procedures for rules when they find "good cause" to do so. Under section 553(b)(B), the requirements of notice and the opportunity for comment do not apply when the agency for good cause finds that those procedures are "impracticable, unnecessary, or contrary to the public interest." Section 553(d)(3) allows an agency, upon finding "good cause," to make a rule effective immediately, thereby avoiding the 30-day delayed effective date requirement in section 553. These exceptions give agencies flexibility by allowing them conclude that the rule was substantive and not procedural. 105/ Id. at 237-38. 106/ ACUS Recommendation 76-5, Interpretive Rules of General Applicability and Statements of General Policy, 1 C.F.R. § 305.76(Continued) to dispense with procedures in promulgating rules not otherwise exempted, but like other exemptions, they are to be construed narrowly. Moreover, an agency must give supporting reasons for invoking the "good cause" exemptions.109 The agency's 108 findings of "good cause" are judicially reviewable on the same basis as any other findings committed to the agency's judgment.110 Though the language of the exemption from the delayed effective date requirement is more general than the standard for dispensing with notice and comment, several commentators have expressed the view that "good cause" under both sections must be predicated 111 on similar findings. The terms "impracticable," "unnecessary" or "contrary to the public interest" used in section 553(b)(B) indicate the circumstances in which the good cause exceptions may be employed. The APA's legislative history defines the terms this way: "Impracticable" means a situation in which the 5 (1983). 107/ Id. at ¶ 2. See also Asimow, supra note 80, at 578-84. 108/ See Mobay Chemical Corp. v. Gorsuch, 682 F.2d 419, 426 (3rd Cir. 1982); Note, The "Good Cause" Exceptions: Danger to Notice and Comment Requirements Under the Administrative Procedure Act, 68 Geo. L.J. 765, 773 (1980). 1097 Legislative History of the APA, supra note 59, at 258. ("The exemption of situations of emergency or necessity is not an 'escape clause' in the sense that any agency has discretion to disregard its terms or the facts. A true and supported or supportable finding of necessity or emergency must be made and published.") 110/ See Bonfield, Military and Foreign Affairs Function Rulemaking Under the APA, 71 Mich. L. Rev. 221, 292 (1972). 111/ See Note, The "Good Cause" Exceptions, supra note 108, at requires that public rulemaking procedures shall Ordinarily, covered situations are those in which advance notice would defeat the agency's regulatory objective; immediate action is necessary to reduce or avoid health hazards or other imminent harm to persons or property; or inaction will lead to serious dislocation in government programs or the marketplace.113 115 Reviewing courts generally have applied the section 553(b)(B) good cause exemption to prevent agencies using it as an "escape clause" from notice and comment requirements. Several patterns emerge from the caselaw interpreting the APA's grounds 114 for invoking the exemption. Courts applying the "contrary to the public interest" ground for exemption are inclined to err on the side of the public safety. They tend to defer to the agency if the challenged action was taken to avoid imminent or direct physical harm to the public; they carefully scrutinize agency action that might increase public exposure to the risk of harm. Courts generally apply the "unnecessary" ground for exemption to minor rules or merely technical amendments that involve little exercise of agency discretion.116 The "impracticable" ground for exemption often is asserted with the "contrary to the public interest" ground. One area that has generated conflicting caselaw involving these grounds is the Environmental Protection Agency's invocation of the good cause exemption to comply with a statutory deadline in the Clean Air Act for approving state lists of areas "attaining" and "not attaining" national air quality standards.117 772 n. 61. 112/ Legislative History of the APA, supra note 59, at 200. 113/ See generally Jordan, The Administrative Procedure Act's "Good Cause" Exemption (1982) (unpublished report to the Administrative Conference of the United States). 114/ This discussion relies heavily on Professor Ellen Jordan's report to the Administrative Conference, supra note 113. 115/ See Jordan, id. at 8-9. 116/ Jordan, id. at 14-17. (Continued) As a general proposition, courts are skeptical of agency reliance on statutory deadlines to justify use of the exemption. A factor that often surfaces in the judicial decisions applying the good cause exemption is whether or not the agency has made a good faith attempt to comply with the APA's requirements. Courts are more inclined to uphold the agency's action if the agency responded to circumstances beyond its control; adopted an emergency rule of limited scope or duration, and initiated follow-up proceedings allowing for public participation. 118 Courts have had difficulty deciding the appropriate remedy for erroneous use of the good cause exemption from notice and comment. Section 706 of the APA states that "reviewing courts shall... hold unlawful and set aside agency action ... found to be ... without observance of procedure required by law."119 However, courts often are reluctant to invalidate otherwise valid rules if it will disrupt on-going programs, and some courts have used their equitable powers to fashion relief that balances the need to uphold procedural values with the need for agencies to carry out 120 important programs. Sometimes courts allow the emergency rules to remain in effect pending completion of new proceedings in accordance with the APA. In one case, the court held the 122 agency's rule was valid, but only as an interim measure. One thing courts have been unwilling to do is excuse wrongful or erroneous use of the good cause exemption because the agency "cured" the procedural defect with an opportunity for public comment after promulgation. Most courts have concluded that 121 117/ See Jordan, id. at 11-14; generally Note, The "Good Cause" Exceptions, supra note 108. 118/ See, e.g., Council of the Southern Mountains, Inc. v. Donovan, 653 F.2d 573 (D.C. Cir. 1981); Northwest Airlines, Inc. v. Goldschmidt, 645 F.2d 1309 (8th Cir. 1981); National Fed'n of Federal Employees v. Devine, 671 F.2d 607 (D.C. Cir. 1982). 119/ 5 U.S.C. S 706(2)(D) (1976). This is qualified by provision that courts may take due account of the rule of prejudicial error. U.S.C. S 706 (1976) (last sentence). 120/ See Jordan, supra note 113, at 48-50. 121/ Id. at 49. 5 T22/ American Fed'n of Gov't Employees, AFL-CIO v. Block, 655 |