Agency Powers and Authority

Agency Powers and Authority

Administrative agencies exercise enormous amounts of governmental power.

They regulate businesses, administer public programs, investigate violations, issue licenses, conduct hearings, promulgate regulations, impose administrative penalties, and make thousands of decisions affecting individuals and organizations every day.

But an agency does not possess governmental power simply because Congress created it.

The central principle of administrative law is:

An agency may exercise only the authority that the law gives it.

That principle sounds simple, but it has profound consequences.

Every significant agency action raises a series of questions:

• Where did the agency’s power come from?
• What statute authorizes the action?
• What exactly did Congress delegate?
• Has the agency stayed within the boundaries of that delegation?
• Did the agency follow the required procedures?
• Is the action consistent with the Constitution?
• Is the agency interpreting a statute or exercising discretion Congress actually gave it?
• Can a court review the action?
• What happens if the agency has exceeded its authority?

These questions form the foundation of agency powers and authority.

For a useful overview, Cornell Law School’s Legal Information Institute explains that administrative agencies receive delegated authority from Congress and must operate within constitutional and statutory parameters. Its current discussion also emphasizes that, after Loper Bright, courts independently interpret statutes and determine the boundaries of delegated agency authority. Cornell Law School — Administrative Law

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1. What Is Agency Authority?

In ordinary language, authority means the legal power to act.

In administrative law, agency authority is the lawful power granted to an administrative agency to perform governmental functions.

Cornell’s Legal Information Institute describes authority as the official permission or right to act and explains that actions taken beyond the scope of authority are ultra vires, meaning “beyond the powers.” Cornell Law School — Authority

An agency’s authority may include power to:

• issue regulations;
• investigate;
• subpoena information where authorized;
• conduct inspections;
• grant or revoke licenses;
• determine eligibility for government programs;
• conduct administrative adjudications;
• issue administrative orders;
• impose authorized penalties;
• collect information;
• enforce statutory requirements; and
• administer federal programs.

But none of these powers exists merely because the agency believes the power would be useful.

The agency must identify a legal source of authority.

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2. The Source of Agency Power

The starting point is usually Congress.

Congress creates a federal agency through an organic statute, sometimes called an enabling statute.

That statute establishes:

• the agency;
• its jurisdiction;
• its responsibilities;
• its powers;
• its procedures;
• its relationship to other governmental institutions; and
• the limits on its authority.

The basic structure can therefore be represented as:

Constitution → Congress → statute → agency → administrative action

The Constitution gives Congress legislative authority.

Congress enacts a statute.

The statute creates or empowers an agency.

The agency then exercises the authority Congress has lawfully delegated.

The agency is therefore not an independent source of governmental power.

It is a creature of law.

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3. Organic Statutes

An agency’s organic statute is one of the most important documents in administrative-law research.

Suppose Congress creates an environmental agency and gives it authority to:

establish standards for specified pollutants in interstate commerce.

The agency may then develop regulations implementing that statutory authority.

But suppose the agency later decides that it should also regulate an entirely different activity that Congress never mentioned.

The agency cannot simply assume that power exists because the new regulation would advance the agency’s general mission.

The lawyer must ask:

Where exactly did Congress authorize this action?

That question is fundamental.

An agency’s general purpose does not automatically authorize every action that the agency believes would help achieve that purpose.

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4. Delegated Authority

Congress frequently cannot write every technical rule necessary to administer a complex federal program.

Congress therefore delegates authority to agencies.

Delegation means that Congress gives an agency authority to perform specified governmental functions within statutory and constitutional boundaries.

For example, Congress might enact a statute requiring an agency to establish safety standards for a particular industry.

Congress establishes the basic policy.

The agency develops technical standards.

The delegation allows the agency to fill in details that Congress has not specified itself.

This is one of the central practical reasons administrative agencies exist.

Cornell’s discussion of the nondelegation doctrine explains that Congress may delegate regulatory authority but must provide sufficient standards to guide the exercise of that authority under the constitutional framework. Cornell Law School — Nondelegation Doctrine

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5. Delegation Does Not Mean Abdication

Delegation does not mean that Congress transfers unlimited legislative power to an agency.

Congress cannot simply say:

“Agency X may do whatever it thinks is appropriate.”

The Constitution places limits on delegation.

The traditional doctrine is known as the nondelegation doctrine.

Under the Supreme Court’s longstanding approach, Congress must provide an intelligible principle to guide the exercise of delegated authority.

The modern doctrine has generally allowed substantial delegations.

But the principle remains important:

Congress may delegate authority, but it cannot simply abandon its legislative responsibility.

The question of how far Congress may go remains one of the central constitutional debates surrounding the administrative state.

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6. Agency Power Is Not Legislative Power

This distinction is frequently misunderstood.

An agency may issue regulations that have the force of law.

But that does not mean the agency possesses the same legislative authority as Congress.

Congress creates the statutory framework.

The agency operates within that framework.

For example:

Congress:
“Regulate emissions according to these statutory standards.”

Agency:
“Here is the technical regulation implementing those standards.”

The agency’s regulation derives its legal authority from the statute.

It does not derive authority from the agency’s own preferences.

This is why agency regulations are sometimes described as delegated rulemaking.

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7. Rulemaking Authority

One of the most important agency powers is rulemaking.

Rulemaking is the process through which an agency formulates, amends, or repeals rules.

Under the APA, a federal agency’s rulemaking authority must come from statutory authority. Many legislative rules require notice-and-comment procedures under 5 U.S.C. § 553.

The basic process often looks like:

Statute

↓

Agency identifies regulatory authority

↓

Proposed rule

↓

Public notice

↓

Public comments

↓

Agency consideration of comments

↓

Final rule

↓

Publication

↓

Judicial review

This process demonstrates an important point:

Substantive authority and procedural authority are different questions.

An agency may have authority to regulate a subject but still fail because it used the wrong procedure.

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8. Legislative Rules

Some agency rules have legally binding effect.

These are commonly called legislative or substantive rules.

They are issued under delegated statutory authority and can impose legal requirements on regulated parties.

For example, a statute may authorize an agency to establish workplace safety standards.

The agency may then issue detailed regulations specifying:

• permissible exposure levels;
• equipment requirements;
• reporting duties;
• inspection standards; and
• compliance procedures.

Those rules can have legal consequences because Congress delegated rulemaking authority to the agency.

But the agency must remain within the statutory boundaries.

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9. Interpretive Rules

Agencies also issue interpretive rules.

These generally explain how an agency understands an existing statute or regulation.

An interpretive rule is different from a legislative rule because it ordinarily does not itself create new binding legal obligations.

The distinction can sometimes be difficult.

An agency might describe a document as “interpretive,” while the document effectively attempts to impose new requirements.

Courts may examine the substance rather than simply accepting the agency’s label.

Cornell’s Wex explanation of administrative rules distinguishes legislative rules, which may have the force of law, from interpretive rules, which generally explain how the agency understands existing law. Cornell Law School — Rule

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10. Guidance and Policy Statements

Agencies also issue:

• guidance documents;
• policy statements;
• manuals;
• interpretive letters;
• enforcement policies;
• FAQs; and
• other informal materials.

These documents can be extremely influential.

A regulated business may follow agency guidance even when the guidance does not formally have the force of law.

But an important limitation exists:

An agency generally cannot transform nonbinding guidance into binding law simply by calling it guidance.

The distinction between binding regulations and nonbinding guidance is therefore important both procedurally and constitutionally.

Agencies cannot avoid statutory procedural requirements merely by changing the label attached to their action.

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11. Enforcement Authority

Agencies may also possess enforcement powers.

Depending on the governing statute, an agency may be authorized to:

• investigate violations;
• inspect regulated facilities;
• demand records;
• issue subpoenas;
• initiate administrative proceedings;
• impose civil penalties;
• revoke licenses;
• issue administrative orders; or
• refer matters to federal prosecutors.

But enforcement authority must come from law.

An agency cannot invent an enforcement power because enforcement would make administration easier.

The agency must be able to identify a statute or other lawful source authorizing the particular enforcement action.

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12. Investigative Authority

Investigation is often an essential component of administrative enforcement.

An agency may need information to determine whether regulated parties are complying with federal law.

Depending on the statute, investigative powers may include:

• requests for information;
• subpoenas;
• inspections;
• audits;
• interviews;
• document demands; and
• other authorized investigative methods.

But investigative power is not unlimited.

Constitutional protections may apply.

For example, searches and inspections can raise Fourth Amendment questions.

A statute may authorize inspections, but the agency must still comply with constitutional restrictions applicable to the particular search or seizure.

Thus:

Statutory authority does not eliminate constitutional limits.

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13. Licensing Authority

Many agencies possess licensing authority.

A license allows an individual or organization to engage in an activity subject to governmental regulation.

Examples include:

• professional licenses;
• broadcasting licenses;
• transportation licenses;
• environmental permits;
• financial registrations;
• occupational certifications; and
• other governmental approvals.

Licensing can give agencies significant practical power.

The agency may decide:

• who qualifies;
• what conditions apply;
• whether a license should be renewed;
• whether a violation has occurred; and
• whether a license should be suspended or revoked.

Because licensing decisions can directly affect property and livelihood interests, constitutional and statutory procedural protections may become important.

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14. Adjudicatory Authority

Some agencies have authority to conduct administrative adjudication.

An agency may decide disputes involving:

• benefits;
• licensing;
• regulatory violations;
• employment;
• immigration;
• professional discipline;
• enforcement actions; or
• other matters assigned by statute.

The APA distinguishes rulemaking from adjudication and establishes different procedural frameworks for formal and informal administrative proceedings. Cornell Law School — Administrative Procedure Act

An agency’s adjudicatory authority does not make it an Article III court.

Administrative adjudication remains part of the administrative system and is subject to statutory, constitutional, and judicial constraints.

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15. Remedial Authority

An agency may sometimes possess authority to provide remedies for violations of the laws it administers.

Depending on the statute, remedies can include:

• civil penalties;
• cease-and-desist orders;
• restitution;
• license suspension;
• license revocation;
• corrective measures;
• compliance orders; or
• other statutory remedies.

The agency cannot assume that every imaginable remedy is available.

The remedy must be authorized.

This produces an important analytical question:

Does the agency have authority not only to find a violation, but also to impose this particular remedy?

The answer may differ.

An agency might have authority to investigate a violation but lack authority to impose a particular monetary penalty.

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16. Procedural Authority

Agency authority includes more than substantive power.

Agencies also have procedural authority.

They may establish procedures governing:

• applications;
• hearings;
• filings;
• investigations;
• internal review;
• appeals;
• licensing;
• compliance;
• public participation; and
• administrative adjudication.

But procedural authority also has boundaries.

An agency cannot create procedural requirements that contradict its governing statute or applicable constitutional protections.

The APA provides a general procedural framework for federal agencies, while individual statutes may impose additional requirements.

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17. Administrative Discretion

Agency authority often includes discretion.

Discretion means that the law gives the agency some lawful choice among multiple possible actions.

For example, Congress might authorize an agency to:

establish standards that are “necessary and appropriate” to accomplish a statutory purpose.

That language may give the agency discretion.

But discretion is not the same as unlimited freedom.

An agency exercising discretion must:

• remain within statutory authority;
• consider relevant factors;
• avoid irrelevant considerations;
• explain important decisions;
• comply with procedural requirements; and
• respect constitutional limitations.

The central distinction is:

Discretion is lawful choice within a legal boundary.

It is not permission to ignore the boundary.

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18. Mandatory vs. Discretionary Authority

Not all statutory language gives agencies the same degree of choice.

Compare:

“The agency shall issue a license when the applicant satisfies the statutory requirements.”

with:

“The agency may issue a license when statutory conditions are satisfied.”

The first formulation suggests a mandatory duty.

The second suggests discretion.

Words such as:

• shall;
• must;
• may;
• reasonable;
• necessary;
• appropriate;
• practicable; and
• feasible

can therefore matter greatly when determining the scope of agency authority.

But statutory interpretation cannot always be reduced to one word.

Courts examine statutory text, context, structure, and other recognized interpretive considerations.

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19. Express Authority

The clearest form of agency authority is express authority.

Congress may expressly authorize an agency to perform a particular function.

For example:

“The Secretary shall establish regulations governing X.”

The statutory language directly identifies the agency’s authority.

Express authorization provides the strongest starting point for determining whether an agency action is lawful.

But even express authority is not unlimited.

The agency must still comply with:

• the Constitution;
• other applicable statutes;
• procedural requirements; and
• judicial review.

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20. Implied Authority

An agency may sometimes possess powers that are reasonably necessary to carry out powers expressly granted by Congress.

This is sometimes described as implied authority.

Suppose Congress expressly authorizes an agency to administer a licensing program.

The agency may reasonably need authority to:

• accept applications;
• establish filing procedures;
• maintain records;
• verify information; and
• communicate decisions.

Those administrative powers may be implicit in the statutory scheme.

But implied authority has limits.

The agency cannot use the concept of implied authority to manufacture a major new power that Congress never granted.

The distinction is especially important when an agency claims authority with significant economic or political consequences.

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21. The Major Questions Doctrine

One modern limitation on agency authority is the major questions doctrine.

The doctrine reflects the principle that courts may require clear congressional authorization when an agency claims authority to decide questions of extraordinary economic or political significance.

The basic concern is:

Did Congress actually give the agency this extraordinary power?

The doctrine therefore focuses on statutory authority.

It does not simply ask whether the agency’s interpretation is reasonable.

It asks whether Congress clearly authorized the agency to exercise the claimed power.

This doctrine has become an important mechanism for limiting expansive assertions of administrative authority.

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22. Loper Bright and Agency Authority

The Supreme Court’s decision in ** Loper Bright Enterprises v. Raimondo (2024)** fundamentally changed how courts review agency interpretations of statutes.

Before Loper Bright, Chevron doctrine often required courts to defer to reasonable agency interpretations when statutes were ambiguous.

That framework no longer governs.

The Supreme Court held that courts must independently interpret statutes and determine the boundaries of delegated authority.

The Court explained that the judicial role includes:

• recognizing valid congressional delegations;
• determining the boundaries of delegated authority; and
• ensuring reasoned agency decision-making within those boundaries.

This is extremely important for agency authority.

The agency cannot establish its own jurisdiction simply by interpreting an ambiguous statute in its favor.

The court independently determines what Congress authorized.

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23. Agency Expertise Does Not Create Authority

Agencies frequently possess specialized expertise.

An environmental agency may know more about environmental science than a federal judge.

A financial regulator may understand securities markets better than many legislators.

A communications agency may possess technical knowledge that courts lack.

But expertise does not itself create legal authority.

This distinction can be expressed simply:

Expertise explains why Congress may delegate power to an agency. It does not expand the power Congress actually delegated.

After Loper Bright, this distinction is particularly important.

Agency expertise may make an agency’s reasoning persuasive.

But expertise does not automatically determine the meaning of a statute.

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24. The Constitutional Limits of Agency Authority

Agency power is limited not only by statutes but also by the Constitution.

Important constitutional constraints include:

Separation of powers

Agencies must operate within the constitutional allocation of governmental powers.

Nondelegation

Congress cannot simply surrender legislative power without constitutional limits.

Due process

Agency action affecting protected interests may require appropriate procedural safeguards.

Fourth Amendment

Investigations, inspections, and searches may implicate constitutional protections.

First Amendment

Agency regulations may affect speech, association, religion, or other protected activities.

Equal protection principles

Government action cannot violate applicable constitutional equality requirements.

Article III

Certain disputes and exercises of judicial power may raise questions concerning the constitutional role of federal courts.

Thus:

Statutory authority is necessary, but it is not always sufficient.

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25. Agency Authority and Presidential Power

Agency authority also interacts with presidential power.

Executive agencies operate within the executive branch.

The President’s constitutional role therefore matters when agencies exercise executive power.

The Supreme Court’s 2026 decision in Trump v. Slaughter emphasized presidential control over officers exercising executive power and rejected the use of statutory removal protection to insulate such officers from presidential removal.

This means that agency authority has at least two dimensions:

What power does Congress give the agency?

and

Who constitutionally controls the officials exercising that power?

The first is primarily a question of statutory authority.

The second can be a question of constitutional structure.

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26. Ultra Vires Agency Action

When an agency acts beyond its lawful authority, its action may be described as ultra vires.

The Latin phrase means:

Beyond the powers.

For example, suppose Congress gives an agency authority to regulate commercial fishing.

The agency then issues a regulation governing an unrelated industry without statutory authorization.

The agency may have acted ultra vires.

An ultra vires action may be challenged in court.

Judicial review can determine whether:

• the agency had statutory authority;
• the agency exceeded its jurisdiction;
• the agency followed required procedures;
• the agency acted arbitrarily or capriciously; or
• the agency violated constitutional rights.

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27. The Difference Between Unlawful Action and Bad Policy

This distinction is essential.

Courts do not ordinarily invalidate agency action simply because judges disagree with the agency’s policy preference.

The question is whether the agency acted lawfully.

An agency might choose Policy A rather than Policy B.

A court does not necessarily replace the agency’s policy judgment with its own.

But if the agency:

• lacks statutory authority;
• ignores mandatory statutory requirements;
• relies on irrelevant factors;
• fails to consider important factors;
• violates constitutional rights; or
• acts without adequate reasoning,

the action may become legally defective.

Administrative law therefore distinguishes:

policy disagreement

from

legal invalidity.

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28. Reasoned Decision-Making

Agency authority also carries an obligation of reasoned decision-making.

An agency must ordinarily provide a rational explanation connecting:

facts → legal authority → relevant considerations → decision

A decision cannot simply announce:

“We have decided this is the appropriate policy.”

The agency must explain why.

The Supreme Court has repeatedly emphasized the importance of reasoned agency decision-making, and Loper Bright expressly incorporated that concept into the judicial role of determining whether agencies have acted within delegated boundaries.

This is one reason the administrative record is so important.

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29. Agency Authority and the Administrative Record

When an agency action reaches federal court, the court often examines the administrative record.

The record may reveal:

• what information the agency considered;
• what statutory authority it relied upon;
• what evidence supported the decision;
• what alternatives it considered;
• what public comments it received;
• what reasoning it adopted; and
• whether the final decision was adequately explained.

The record can therefore expose an agency that has exceeded its authority or failed to exercise its discretion rationally.

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30. Judicial Review of Agency Authority

Judicial review is one of the principal safeguards against unlawful agency power.

A court may ask:

1. Did Congress authorize the agency’s action?

2. Did the agency stay within the statutory boundary?

3. Did the agency follow required procedures?

4. Did the agency consider the relevant factors?

5. Did the agency adequately explain its decision?

6. Did the agency violate the Constitution?

7. Did the agency act arbitrarily or capriciously?

8. Is the challenged action final and otherwise reviewable?

The court’s role is not simply to determine whether it likes the agency’s policy.

It is to determine whether the agency acted within the law.

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31. Authority, Jurisdiction, and Power

These concepts are related but should not be treated as identical.

Authority

The legal power to act.

Jurisdiction

The scope of matters over which an agency has legal authority.

Power

The practical governmental capacity to act.

An agency might possess broad statutory power but only within a particular jurisdiction.

For example:

An agency may have authority to regulate securities transactions but not agricultural land use.

Its power therefore stops at the boundaries established by law.

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32. Agency Authority Is Often Conditional

An agency may possess authority but only if certain conditions are satisfied.

For example, Congress may authorize an agency to issue a regulation if it determines that:

• a statutory standard is met;
• specified findings have been made;
• scientific evidence supports the action;
• public notice has been provided; or
• an emergency exists.

The agency’s power is therefore conditional.

The legal question becomes:

Did the conditions for exercising the power actually exist?

If they did not, the agency may have acted unlawfully even though the statute generally gives the agency that type of authority.

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33. Agency Authority and Emergencies

Emergency powers illustrate the importance of statutory boundaries.

Congress may give an agency special authority to act rapidly during emergencies.

Such authority may permit:

• temporary regulations;
• emergency orders;
• expedited enforcement;
• emergency licensing decisions; or
• temporary restrictions.

But emergency status does not automatically erase legal limits.

The agency must still identify the statutory basis for the emergency authority.

And constitutional rights do not disappear simply because government action is urgent.

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34. Agency Authority and Enforcement Discretion

An agency may also possess discretion over whether and how to enforce the laws it administers.

An agency may have thousands of possible violations but limited resources.

It may therefore prioritize:

• serious violations;
• repeat offenders;
• immediate risks;
• systemic problems; or
• matters with significant public consequences.

Enforcement discretion can be legitimate.

But the agency cannot use enforcement discretion as a license for arbitrary discrimination, retaliation, or action forbidden by law.

Again:

Discretion is bounded authority.

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35. The Boundary Between Authority and Policy

One of the most important analytical distinctions in administrative law is between:

What the agency may do

and

what the agency should do.

The first is primarily a legal question.

The second may be a policy question.

Suppose Congress gives an agency authority to choose between several permissible regulatory approaches.

The agency might choose one approach over another.

That choice may involve:

• economics;
• science;
• policy;
• risk;
• administrative feasibility;
• political priorities; and
• technical expertise.

But the agency must first establish that the chosen approach falls within the authority Congress granted.

Legal authority comes before policy preference.

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36. A Practical Example

Imagine Congress passes a statute requiring a federal agency to regulate workplace exposure to a particular chemical.

The statute authorizes the agency to:

• establish exposure limits;
• require employer monitoring;
• conduct inspections; and
• impose specified civil penalties.

The agency then adopts a regulation requiring employers to install a particular type of ventilation system.

The first question is not:

“Is this a good policy?”

The first question is:

“Does the statute authorize the agency to require this?”

If yes, the next questions might concern:

• rulemaking procedure;
• evidence;
• public comments;
• statutory standards;
• reasoned decision-making;
• economic considerations where relevant; and
• constitutional issues.

If the agency instead adopts a regulation requiring every employer to provide unrelated medical benefits, the authority problem becomes much more obvious.

The agency may believe the policy is beneficial.

But beneficial policy is not a substitute for statutory authorization.

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37. A Lawyer’s Agency-Authority Checklist

When analyzing an agency action, ask these questions in order:

Step 1 — Identify the agency

What agency acted?

Step 2 — Identify the organic statute

What statute created or empowers the agency?

Step 3 — Identify the claimed authority

What provision does the agency rely upon?

Step 4 — Identify the type of power

Is the agency:

• making a rule;
• enforcing a law;
• investigating;
• adjudicating;
• licensing;
• administering a program; or
• issuing guidance?

Step 5 — Determine the statutory boundary

What exactly did Congress authorize?

Step 6 — Check for conditions

Were statutory prerequisites satisfied?

Step 7 — Check procedure

Did the agency follow the APA or another applicable procedure?

Step 8 — Check constitutional limits

Does the action implicate:

• separation of powers;
• nondelegation;
• due process;
• the First Amendment;
• the Fourth Amendment; or
• another constitutional protection?

Step 9 — Apply Loper Bright

Who has the final responsibility for interpreting the statute?

The court independently interprets the statute and determines the boundaries of delegated authority.

Step 10 — Determine the remedy

If the agency exceeded its authority, what judicial remedy is available?

This sequence turns an abstract administrative-law question into a practical legal analysis.

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38. The Central Principle

All of these doctrines ultimately express one fundamental idea:

Government officials do not possess governmental power merely because they hold governmental positions. They possess only the power that law gives them.

This principle applies to agencies just as it applies to other governmental institutions.

The agency’s expertise does not create authority.

Its mission does not create authority.

Its policy preferences do not create authority.

Its previous practice does not automatically create authority.

Its interpretation of an ambiguous statute does not automatically create authority.

Authority must have a lawful source.

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Frequently Asked Questions

What is agency authority?

Agency authority is the legal power granted to an administrative agency to perform governmental functions.

Where does agency authority come from?

For federal agencies, authority ordinarily comes from the Constitution and federal statutes, particularly the agency’s organic or enabling statute.

Can an agency create its own powers?

No. An agency cannot manufacture governmental authority simply because it believes a particular power would be useful.

What is delegated authority?

Delegated authority is governmental authority that Congress has lawfully assigned to an agency to exercise within specified boundaries.

What is the difference between authority and discretion?

Authority determines whether an agency has the legal power to act. Discretion concerns the lawful choices available to the agency once that authority exists.

What is ultra vires agency action?

Ultra vires action is action taken beyond the agency’s lawful authority.

Can agencies make laws?

Agencies may issue regulations with the force of law when Congress has lawfully delegated rulemaking authority. Agencies do not possess Congress’s general legislative power.

Can agencies interpret statutes?

Agencies necessarily interpret statutes when administering them. But after Loper Bright, courts independently determine statutory meaning rather than applying Chevron’s mandatory deference framework.

Does agency expertise give an agency more legal authority?

No. Expertise may make an agency’s reasoning persuasive, but expertise does not expand the authority Congress delegated.

Can an agency enforce a law?

Yes, when Congress has granted the agency appropriate enforcement authority.

Can agencies conduct investigations?

Yes, when authorized by law. The agency’s investigative authority may nevertheless be subject to constitutional protections such as the Fourth Amendment.

Can agencies impose penalties?

They may impose penalties when Congress has authorized the agency to do so and the agency follows applicable legal and procedural requirements.

What is the major questions doctrine?

The major questions doctrine can require clear congressional authorization when an agency claims authority over questions of extraordinary economic or political significance.

Can courts invalidate agency action?

Yes. Courts may invalidate or set aside unlawful agency action where the agency exceeded its authority, violated applicable procedures, acted arbitrarily or capriciously, or violated the Constitution.

Does the President control agency authority?

The President may have significant constitutional and statutory authority over executive administration, but presidential control does not allow an agency or the President to exceed statutory authority.

Why is agency authority so important?

Because administrative agencies exercise substantial governmental power. Agency authority determines the boundary between lawful administration and government action that exceeds the power granted by law.

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Key Takeaways

• Agency authority is the legal power to act.
• Federal agencies generally derive their authority from the Constitution and statutes enacted by Congress.
• An agency’s organic statute is usually the starting point for determining its powers.
• Congress can delegate authority to agencies, but delegation has constitutional limits.
• The nondelegation doctrine limits Congress’s ability to transfer legislative power without sufficient standards.
• Agencies may exercise several different kinds of authority, including:
  • rulemaking;
  • enforcement;
  • investigation;
  • licensing;
  • adjudication;
  • administration; and
  • remedial authority.
• Express authority comes directly from statutory language.
• Implied authority may permit actions reasonably necessary to carry out expressly granted powers, but it cannot become a substitute for congressional authorization.
• Agency discretion is bounded discretion, not unlimited governmental freedom.
• An agency may not exceed its statutory jurisdiction simply because its action appears useful or desirable.
• Rulemaking authority and procedural authority are distinct.
• Agencies must comply with the Administrative Procedure Act and other applicable procedural requirements.
• Agency action can also be limited by the Constitution.
• The major questions doctrine can require clear congressional authorization for extraordinary exercises of administrative power.
• Loper Bright ended Chevron’s mandatory framework of judicial deference to agency statutory interpretations.
• Courts now independently interpret statutes and determine the boundaries of delegated authority.
• Agency expertise does not itself create legal authority.
• Action beyond an agency’s lawful authority may be ultra vires.
• Judicial review is an essential mechanism for enforcing the boundary between lawful agency authority and unlawful administrative power.

Conclusion

Agency powers and authority are at the heart of administrative law.

An agency may appear powerful because it regulates industries, investigates violations, issues regulations, conducts hearings, grants licenses, and imposes penalties. But behind every one of those powers lies a more fundamental question:

Where does the authority come from?

The answer ordinarily leads back to law.

Congress creates agencies and establishes their statutory missions. Through delegation, Congress may give agencies substantial responsibility for implementing complex legislative programs. Agencies can then exercise technical expertise, develop regulations, administer programs, investigate violations, and enforce statutory requirements.

But delegation has a boundary.

An agency cannot transform its policy preferences into legal authority. It cannot enlarge its jurisdiction merely because a broader interpretation would be convenient. It cannot bypass required procedures simply because those procedures are inconvenient. And it cannot exercise governmental power in violation of the Constitution.

The modern post-Loper Bright framework makes this especially important.

Courts no longer begin with the assumption that an agency’s reasonable interpretation of an ambiguous statute controls. Instead, courts independently interpret the statute, identify the boundaries Congress established, recognize valid delegations, and determine whether the agency acted within those boundaries.

The fundamental relationship can therefore be expressed in one sentence:

Congress creates the legal authority, the agency exercises the delegated authority, and the courts ultimately enforce the boundaries of that authority.

That relationship is the foundation upon which the modern administrative state rests.

And once the source and limits of agency authority are understood, the next question follows naturally:

How far may Congress actually go when delegating governmental power to an administrative agency?