Chevron USA v Natural Resources Defense Council Decision Codified Administrative Deference

In Chevron USA v Natural Resources Defense Council, 467 U.S. 837 (1984), the U.S. Supreme Court established the standard of judicial review that courts should apply when evaluating an agency’s construction of a statute which it administers. Under the Court’s decision, “if Congress has not directly spoken to the precise question at issue, the question for the court is whether the agency’s answer is based on a permissible construction of the statute.”

Facts of Chevron USA v Natural Resources Defense Council

The Clean Air Act Amendments of 1977 imposed certain requirements on states that failed to achieve the national air quality standards established by the Environmental Protection Agency (EPA). Of relevance to the case, “nonattainment” states were required to establish a permit program regulating “new or modified major stationary sources” of air pollution.

The EPA promulgated regulations in 1981 to implement the permit requirement. The regulations allowed a state to adopt a plant-wide definition of the term “stationary source,” under which an existing plant that contains several pollution-emitting devices may install or modify one piece of equipment without meeting the permit conditions if the alteration will not increase the total emissions from the plant. This allowed a state to treat all of the pollution-emitting devices within the same industrial grouping as though they were encased within a single “bubble.”

The Natural Resources Defense Council (NRDC) challenged the EPA regulations. After the district court ruled in the environmental group’s favor, Chevron U.S.A filed a petition for review in the Court of Appeals for the D.C. Circuit. The appeals court set aside the regulations embodying the “bubble concept” as contrary to law.

Court’s Decision in Chevron USA v Natural Resources Defense Council

The Court unanimously upheld the EPA’s interpretation of the Clean Air Act. Justice John Paul Stevens wrote on behalf of the Court. Justices Thurgood Marshall, William H. Rehnquist, and Sandra Day O’Connor did not participate.

In its decision, the Court established a two-step process for courts to use when evaluating an administrative agency’s interpretation of a statute it administers. As Justice Stevens explained:

First, always, is the question whether Congress has directly spoken to the precise question at issue. If the intent of Congress is clear, that is the end of the matter; for the court, as well as the agency, must give effect to the unambiguously expressed intent of Congress. If, however, the court determines Congress has not directly addressed the precise question at issue, the court does not simply impose its own construction on the statute . . . Rather, if the statute is silent or ambiguous with respect to the specific issue, the question for the court is whether the agency’s answer is based on a permissible construction of the statute.

With regard to the EPA’s plant-wide definition, the Court concluded that it was “a permissible construction of the statutory term ‘stationary source.’” In support, Justice Stevens highlighted that the legislative history of the Clean Air Act was “consistent with the view that the EPA should have broad discretion in implementing the policies of the 1977 Amendments.” He further noted that the EPA’s definition was “fully consistent with the policy of allowing reasonable economic growth, and the EPA has advanced a reasonable explanation for its conclusion that the regulations serve environmental objectives as well.”

The Court’s decision in Chevron is one of its most frequently cited. The administrative law doctrine is most commonly referred to simply as “Chevron deference.”