The Administrative Procedure Act (APA) governs the practice and procedural formalities of administrative agencies of the federal government, including the U.S. Department of the Treasury. The APA basically delineates the manner in which U.S. administrative agencies may establish regulations and the process of judicial review of agency decisions.
History of the APA
The APA was essentially a compromise between supporters and opponents of the New Deal programs that were initiated mainly during President Franklin D. Roosevelt’s first term in office (1933-1937). For a decade after the passage of the controversial Second New Deal, which included the establishment of the Social Security Act, the U.S. Housing Authority and the Fair Labor Standards Act, Republicans and Southern Democrats attempted to terminate New Deal programs (particularly the Securities and Exchange Commission and the National Labor Relations Board) through administrative and judicial restrictions on various governmental agencies. In turn, President Roosevelt vetoed bills that sought to strictly control those agencies.
In the early 1940s, a lengthy and detailed negotiation process was initiated that eventually led to enactment of the APA. Carl McFarland, Chairman of the American Bar Association’s Special Committee on Administrative Law, was respected by both supporters and opponents of the New Deal and was able to facilitate a compromise between the two sides. The APA effectively ended the battle between those who sought more bureaucratic power and supporters of individual rights. Although neither side was particularly enthusiastic about the APA, it gave broad freedom to governmental agencies yet imposed procedural requirements and standards for public participation in and judicial review of agency actions. In short, both sides gained a great deal and agreed that it was better than nothing.
Purposes of the APA
The APA has four main purposes:
- Establish uniform standards for rulemaking and adjudication
- Ensure that administrative agencies keep the public informed of rules and procedures
- Provide opportunities for the public to participate in the rulemaking process
- Define the scope of judicial review
The APA sets forth guidelines for administrative agencies on how to develop and issue rule and regulations. It includes guidelines the publishing of notices, policy statements, licenses, and permits, and provides an opportunity for the public to comment on proposed rules before they become effective.