Notice of Rulemaking: An Overview

APA section 553(b) requires that agencies publish “general notice of proposed rulemaking” in the Federal Register. A “Notice of Proposed Rulemaking” in the Federal Register (often abbreviated as “NPRM” or “NOPR”) serves as constructive notice of a new rule, and is legally sufficient notice even if an affected party is not aware of the notice. Lawyers and advocates doing regulatory work should read regulatory updates and news, or look at Regulations.gov or the Federal Register regularly to see whether there are any new proposed rules that may impact their clients or work.

According to APA section 553(b), NPRMs must include the “time, place, and nature” of the public proceedings so that people can participate in the commenting process. NPRMs must also state the legal authority under which the proposed rule is proposed (the enabling statute). Agencies also have to provide “either the terms or substance of the proposed rule or a description of the subjects and issues involved.” 

Agencies usually publish much more than the bare minimum notice required by APA section 553(b). An NPRM usually contain the full text of the proposed rule and an extensive “preamble” that gives background and describes what the rule is intended to do. Thorough NPRMs have evolved because statutes have added requirements to rulemaking on top of the “boilerplate” APA requirements, and also because agencies want to avoid getting sued for lack of notice by providing plenty of notice.

But, even with long, in-depth NPRMs, agencies still sometimes fail to provide sufficient notice. The APA’s notice requirement was supposed to ensure that agencies sufficiently apprised “interested persons” of the issues involved so that they could “present responsive data or argument.” S. Doc. No. 248, 79th Cong., 2d Sess. 200 (1946). When agencies fail to provide adequate notice to apprise stakeholders of the issues involved in the rulemaking, courts will remand the final rules back to the agencies, and the agencies will have to go through new notice and comment periods. 

It is not unusual for agencies to be challenged about the sufficiency of the notice they give when they propose rules. Whenever agencies adopt final rules that are different from what the NPRM describes, stakeholders may claim that the agencies failed to provide adequate notice. The stakeholder has to wait for the final rule to come out though… The courts must then weigh whether the notice was sufficient, and whether the change to the proposal was minor or more consequential. Sometimes, agencies note unresolved issues that may change in the NPRM preamble, but other times, agencies change their rulemaking decisions mid-course because of information that commenters provide or other things they learn in the course of the rulemaking process. 

The courts have to balance the interest of the public in being notified about what agencies are proposing in the rulemaking process with the interest of administrative flexibility - allowing the agency to improve rules without continually having to re-start the notice and comment process with a new notice for every amendment. Agencies claim that the latter would prevent them from ever changing a proposed rule, but, if agencies can change rules without giving new notice, people are denied the opportunity to participate and influence rulemaking outcomes. 

The test courts apply to make this difficult balancing choice is the “logical outgrowth test.” Courts have decided that the public has notice when the final rule is a “logical outgrowth” of the rulemaking process. Specifically, the court sees whether the final rule materially alters the issues in the rulemaking or, if the final rule substantially departs from the terms or substance of the proposed rule. In those cases, notice is inadequate for the purposes of the Administrative Procedure Act. 

These two cases are examples of how the court applies the logical outgrowth test. The first case is a fun topic Chocolate Manufacturers and the second case is a horribly confusing topic with fun logical outgrowth language.