I've written about Chevron step 1.5 in previous posts. It's the little-known and rarely applied rule that Chevron deference is inappropriate when an agency believes the statutory language at issue is unambiguous. The step 1.5 principle is rooted in the presumption underlying Chevron itself--that when more than one reasonable interpretation of a statute exists even after a court has exhausted all traditional tools of statutory construction, Congress would generally prefer that the expert agency rather than the court resolve the ambiguity. That is so, the argument goes, for several interrelated reasons, including the following:

(1) agencies are more politically accountable than courts;

(2) agencies have expertise in their areas of authority that courts lack; and

(3) the choice between two reasonable interpretations that remain even after courts have exhausted their statutory interpretation toolkit will often be a policy-laden one more appropriate for an agency than a court.

Step 1.5 applies that rationale to the specific case of judicial review of an agency's interpretation of a statutory provision that the agency itself believes is unambiguous. Think about it: if the agency views the provision at issue as unambiguous, then it necessarily has no choice but to apply the language as written. Its hands are tied. As a result, it cannot possibly bring any expertise to bear on the question, and its view of the policy concerns implicated by the text are irrelevant. Because the factors justifying Chevron deference indisputably don't exist in such a situation, some courts--those that apply step 1.5--have refused to grant Chevron deference in such circumstances.

To my knowledge, no court has ever applied the step 1.5 principle as part of the related Auer framework, which, in some circumstances, permits courts to defer to agency interpretations of their own ambiguous regulations. In Kisor v. Wilkie, the Supreme Court's recent decision applying stare decisis principles to retain a limited version of Auer, the Court's explanation of Auer's limitations implied that some sort of step 1.5 principle must apply in the Auer/Kisor context. Here is the key passage:

Next, the agency’s interpretation must in some way implicate its substantive expertise. Administrative knowledge and experience largely “account [for] the presumption that Congress delegates interpretive lawmaking power to the agency.” Martin, 499 U.S. at 153, 111 S.Ct. 1171. So the basis for deference ebbs when “[t]he subject matter of the [dispute is] distan[t] from the agency’s ordinary” duties or “fall[s] within the scope of another agency’s authority.” Arlington, 569 U.S. at 309, 133 S.Ct. 1863 (opinion of BREYER, J.). This Court indicated as much when it analyzed a “split enforcement” scheme, in which Congress divided regulatory power between two entities. Martin, 499 U.S. at 151. To decide “whose reasonable interpretation” of a rule controlled, we “presum[ed] Congress intended to invest interpretive power” in whichever actor was “best position[ed] to develop” expertise about the given problem. Id., at 149, 153, 111 S.Ct. 1171. The same idea holds good as between agencies and courts. “Generally, agencies have a nuanced understanding of the regulations they administer.” Brief for Respondent 33. That point is most obvious when a rule is technical; think back to our “moiety” or “diagnosis” examples. See supra, at 2410 - 2411. But more prosaic-seeming questions also commonly implicate policy expertise; consider the TSA assessing the security risks of pâté or a disabilities office weighing the costs and benefits of an accommodation. See ibid. Once again, though, there are limits. Some interpretive issues may fall more naturally into a judge’s bailiwick. Take one requiring the elucidation of a simple common-law property term, see Jicarilla Apache Tribe v. FERC, 578 F.2d 289, 292-93 (CA10 1978), or one concerning the award of an attorney’s fee, see West Va. Highlands Conservancy, Inc. v. Norton, 343 F.3d 239 (CA4 2003). Cf. Adams Fruit Co. v. Barrett, 494 U.S. 638, 649-50 (1990) (declining to award Chevron deference when an agency interprets a judicial-review provision). When the agency has no comparative expertise in resolving a regulatory ambiguity, Congress presumably would not grant it that authority.

The Court also explained that the same rationale justifies its refusal to defer to agency interpretations of regulations that merely parrot statutory language:

For a similar reason, this Court has denied Auer deference when an agency interprets a rule that parrots the statutory text. See Gonzales v. Oregon, 546 U.S. 243, 257 (2006). An agency, we explained, gets no “special authority to interpret its own words when, instead of using its expertise and experience to formulate a regulation, it has elected merely to paraphrase the statutory language.” Ibid.

Expertise matters, the Court explained, because "the core theory of Auer deference is that sometimes the law runs out, and policy-laden choice is what is left over." Congress would presumably prefer an expert agency with some political accountability to make such policy calls instead of a non-expert, unaccountable court.

By that logic, courts must refuse deference in step 1.5 cases. After all, an agency that thinks the language of the regulation is unambiguous and therefore leaves the agency no choice but to apply the text as written cannot possibly bring its expertise to bear on the question, and its views regarding any policy questions implicated by the regulatory text are entirely irrelevant. (One exception to this principle might exist for cases where the agency says it views the language as unambiguous but adds that its expertise in the area would lead it to reach the same result in any event).

In short, it seems to me that Kisor requires courts to apply a step 1.5 rule when reviewing agency interpretations of their own regulations. If I'm right, that's a pretty big deal. In Kisor itself, for example, the agency insisted that the statutory language unambiguously commanded its favored interpretation, which means should be a 1.5 case. Furthermore, although the various opinions in Kisor repeatedly noted various differences between the Auer and Chevron frameworks, the Court in the passage above relied on Chevron cases for the proposition that deference is inappropriate in cases where the agency's expertise/policy judgment wasn't involved. Does that mean that the Court would like to see step 1.5 applied more broadly in Chevron cases as well? Sure seems like it. See Epic Systems v. Lewis.

Kisor Step 1.5
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