How legislators can reform the administrative state in the states
The federal administrative state rightfully receives much attention from elected officials and policymakers. So should the state administrative state.
State constitutions have unique features that the U.S. Constitution does not: They provide more robust protections for the separation of powers. State legislators should use these protections to downsize the sprawl of the state administrative state and strengthen political accountability that unelected agency officials owe to the people and the people’s elected representatives in state government.
Here are legislative solutions that state lawmakers should consider.
1. State legislatures should take a closer look at the appointment and removal of state agency officials.
Only a small slice of state agency officials are popularly elected. The vast majority of agency heads are appointed by the governor, some with senate confirmation and some without. State statutes have largely taken an ad hoc approach to the appointment and removal of these high-ranking (yet unelected) state officials. Legislatures sometimes have zero control over significant state appointments—which makes the entire apparatus of state government less accountable to the people. State legislatures should consider amending or enacting statutes to ensure that unelected state agency heads are accountable both to the governor and the legislature, typically the senate.
A second aspect of political accountability is the power to remove agency heads from office. Once appointed, most state agency heads are insulated from executive control. Governors cannot fire agency heads of most agencies, which means the chief executive of the state can exert little if any meaningful control over officers in the executive branch. Many agency-specific statutes also have express for-cause removal protections written into state law. But there are also many statutes that are simply silent as to agency head removal. State legislatures should consider amending or enacting statutes to ensure that high-ranking unelected executive-branch officials are removable at the will of the governor or by the elected head of the agency.
State constitutions give the governor exclusive power to control, direct, and supervise the portion of the executive branch that is not headed by an elected official. While many state constitutions provide for popular election of some executive-branch officials, such as the attorney general or secretary of state, the governor’s power over the remainder of the unelected executive-branch officials is all-encompassing—and that power is vested in the governor alone. State legislatures should keep unelected bureaucrats accountable to the people by reforming appointment and removal statutes.
2. State legislatures should revise state agency funding and spending mechanisms.
The people, acting through their legislators, control the state’s purse strings. State constitutions mandate that. But many agencies are set up as self-funded agencies. They collect fees and fines from those they regulate. That money goes into the agency’s fund, not the state’s general fund. Such self-funding mechanisms allow agencies to have a discretionary war chest that can be deployed against the elected representatives and the policy objectives of the state’s elected officials. Such a system is the opposite of what the state constitutions contemplate. State legislatures should (1) require all of the fees and fines collected by state agencies to be deposited in the state’s general fund, and (2) appropriate monies from the state’s general fund for the daily operations of the agencies on an annual basis. Such a system would implement effective legislative control over agencies’ revenue-raising and spending. It would also make appropriations and budgeting more honest, transparent, and responsive to the policy goals set by the governor and the legislature.
3. State legislatures should take a closer look at what if any legislative controls there should be to control agencies’ rulemaking power.
State legislatures have delegated a vast amount of legislative power to executive-branch agencies. Rulemaking means agencies can make law in place of the legislature. Because such power is quintessentially legislative, delegating that power to executive-branch agencies is circumspect under the state constitutions’ separation-of-power provisions, which expressly state that no department shall perform the functions properly belonging to a sister department. That means the executive department cannot perform the functions of the legislative department and vice versa. Giving legislative power to agencies must therefore go hand in hand with meaningful legislative control over the use of that power by the agencies. Some states have robust gubernatorial control over agency rulemaking. For example, statutes require agency draft rules to be approved by the governor before the rules can go into effect. While executive control has its virtues, it is not and cannot be a stand-in for robust legislative control over the legislative power wielded by the agencies. State legislatures should consider enacting reforms such as the REINS Act or the Targeted Legislative Review Act. The product of agencies’ use of legislative power enjoys greater legitimacy if agency-crafted rules go into effect only after the legislature approves them. These and other reforms contained in the REINS Act better implement the state constitutions’ separation-of-power clauses.
4. State legislatures should limit agency abuse of their investigation power.
To effectively regulate, state agencies must have some power to conduct investigations. But most statutes give broad investigative power to agencies that goes well beyond even the police power vested in local police departments or the state or county attorneys general. Agencies enjoy the power to issue subpoenas and conduct administrative searches and seizures without the corresponding checks imposed by the federal Fourth and Fifth Amendments and the state constitution counterparts to those federal constitutional protections.
Many state constitutions have private affairs clauses that provide greater protections than the federal constitution. Under those clauses, the private affairs of the people cannot be invaded without just cause. State legislatures should revise statutes pertaining to administrative investigations. That would better implement the state constitutions’ private affairs clauses and protect the people from agency abuse of power.
5. State legislatures should enact the Restoring the Right to Trial Act.
Legislatures have given agencies the power to make case-by-case determinations. We call this system agency (or administrative) adjudication. The system of agency adjudication is incompatible with state constitutions in at least three ways. First, state constitutions vest the power of case-by-case decisionmaking in the judicial branch. Second, state constitutions require jurors, not government officials, to decide facts and decide guilt or innocence. By sitting as jurors, the people of the state exercise a direct check on both the government prosecutor and the judge. Third, state constitutions’ due-process clauses structurally guarantee a system whereby the law to be applied is clearly established by the legislature, the executive then enforces that law by filing suit in courts where juries decide facts and the judge decides what the law is. State legislatures should enact the Restoring the Right to Trial Act. The Act creates the option for administrative respondents to remove their case from the agency to the state’s trial court. Such a removal option is necessary to implement state constitutions’ carefully balanced separation of powers.
Find more model policies for curbing administrative overreach at the state level on Pacific Legal Foundation’s State Policy page, under “Separation of Powers.”
