USDE: The Era of “Rule by Letter” is…Back?

On September 7, 2017, in remarks about the previous administration’s approach to Title IX, former U.S. Secretary of Education, Betsy DeVos announced that “the era of rule by letter” was over. On Monday, Secretary Cardona’s Department announced that the culmination of that DeVos deregulatory effort would be rescinded.

On October 5, 2020, the Trump Administration published an Interim Final Rule (IFR) entitled, “Promoting the Rule of Law Through Improved Agency Guidance Documents.” (Link) Following the mandate in Executive Order #13891, the IFR sought to establish internal USDE processes and procedures for the development of new regulations. The IFR created the Regulatory Reform Task Force (RRTF), which was empowered to review all of the Department’s regulatory efforts. The IFR also described the steps necessary before the development of a “significant regulation,” including a review of the need for regulation and whether legal authority supported the action. In addition, a ten year review cycle for every Department regulation was established. The IFR also created special rules for economically significant rules (defined as: a rule with an annual effect on the economy of $100 million or more) and “high-impact” rules (defined as: a rule with a total annualized cost to the U.S. economy of $500 million or more or a total net loss of at least 250,000 full-time jobs).

On January 20, 2021, the Biden Administration revoked Executive Order #13891 and directed agency heads to promptly rescind “any orders, rules, regulations, guidelines, or polices” implementing or enforcing the revoked Executive Order.

On September 28, 2021, the Department published final regulations that revoked the IFR, in full, without publishing a replacement. (Find the final regulations here) As USDE reasoned, recent experience since the passage of the IFR led the Department “to recognize that many of the procedures required by the IFR create[d] obstacles to the timely issuance of regulatory and guidance documents” that do not benefit the Department or the public. Further, the Department concluded that the IFR did not help achieve the goals of the IFR, including: increasing transparency, fairness, public participation, and strengthening the overall quality and fairness of USDE’s processes.

The Department also determined that the rules surrounding economically significant and high-impact rules did not achieve any meaningful goals and, instead, served to benefit sophisticated stakeholders, rather than the needs of students, children, and their families.

Internally, USDE stated that the IFR created “unreasonable burdens” on Department staff and slowed the process of issuing regulatory and guidance documents without improving quality.

The Department’s final regulations also included responses to public comments. Below is a brief summary of significant comments and responses:

  • A majority of commenters urged USDE to withdraw the IFR entirely.
  • A commenter remarked that the IFR would “curb abuses of administrative power.” The Department responded that it did not agree that there is abuse of administrative power at USDE.
  • USDE agreed with commenters who suggested that an internal, ten-year cycle of reviewing Department regulations was too burdensome on USDE staff. (Generally, Department staff are not allowed to comment on proposed regulations.)
  • Regarding guidance documents, the Department remarked:

“We recognize the value of timely guidance and agree that the IFR’s policy to disfavor guidance except in special circumstances and the requirement that Department staff demonstrate a compelling operational need to issue new guidance creates an unreasonable presumption that guidance is almost always unnecessary. By rescinding the IFR, the Department will have the ability to issue guidance, which may include technical assistance documents and electronic announcements, more quickly when needed. Additionally, with the rescission of the IFR, the Department will use an internal clearance process that is appropriate for the nature and scope of the guidance documents being issued.”

  • USDE did not directly respond to a commenter who stated that guidance documents will likely “foster confusion among constituencies.” Rather, the Department argued that the rescission will allow the Department flexibility to provide information about guidance documents that is appropriate for the intended audience and subject matter.
  • The Department concluded that the IFR’s 30-day public comment period on guidance documents “would hinder the Department’s ability to provide stakeholders with timely information relating to new and existing law and requirements,”

The long-term effects of this rescission are hard to quantify. While “rule by letter” may return to some extent, it is important to point out that it never really left. Despite its protestations, the Trump Administration published plenty of guidance and sub-regulatory guidance in keeping with the tradition of previous administrations.

In truth, the IFR never really “got off the ground” and it is unclear what real impact it would have had long-term on curbing the “regulatory abuses” that the previous administration had identified. Needless to say, with Title IV negotiated rulemaking set to begin on Monday, the Biden Administration and Secretary Cardona have staked out their own approach to the Department’s rulemaking authority.

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The opinions expressed on this blog are those of the author and are not to be construed as legal advice.

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