Supreme Shift: What the Chevron Ruling Means for Transportation Construction

by Prianka Sharma, vice president & counsel, regulatory affairs, ARTBA

Earlier this year, my regulatory forecast mentioned that we were awaiting a decision in a Supreme Court case that could shape the future of federal regulations. Well, the wait is over. In a huge shift, the Supreme Court in Loper Bright Enterprises v. Raimondo overturned the long-standing Chevron doctrine.

Federal agencies derive much of their power from interpreting and implementing laws passed by Congress. Named for a 1984 case, Chevron allowed agencies to interpret uncertain provisions in those laws using a two-part test: (1) determine whether Congress has already spoken on the issue; and (2) if not, decide if the statute is ambiguous or silent, and therefore open to reasonable interpretation. While supporters argued that Chevron provided necessary flexibility and applied expertise to policymaking, critics claimed it gave federal agencies too much power, leading to overreach and inconsistent enforcement.

Many have asked me how this new ruling will alter the regulatory landscape for transportation construction. The implications could be significant, but far from instantaneous. The ruling mainly applies to new regulations agencies will try to implement and those currently being challenged in courts on the basis of statutory interpretation. Final federal rules beyond the statute of limitations for facial challenge are unlikely to be reopened solely based on this decision.

As new and challenged rules work their way through the process, courts will no longer have to apply Chevron and its strong deference to federal agency interpretations. Judges will now scrutinize agency actions more closely using other legal tests with stricter requirements. The courts must ensure that agency policies align strictly with statutory authority.

What This Means for the Future of Federal Regulation:

• Detailed explanations and justifications for rules: Courts will not automatically accept agency interpretations, meaning agencies must be more careful and thorough in their rulemaking.
• Consistent interpretations of laws: Frequent changes in policy or interpretation will be less likely to hold up in court, leading to more stability in regulatory policy. In other words, less “pendulum swinging” depending on who’s in office.
• Agencies must demonstrate why their interpretations are necessary and valid: This includes showing how their rules align with the law and presenting strong arguments for their policies.
• Fewer rules that appear to push a particular political agenda: Any new regulations will need strong, well-documented justifications to pass judicial scrutiny.
• Increased legal challenges: With courts now playing a more significant role in interpreting laws, we might see an increase in litigation, and more cases centered around an agency’s interpretations of the law.
• Potential for more non-regulatory actions: Agencies may attempt to regulate using methods other than notice and comment rulemaking such as memoranda, guidance documents etc.

Post-Chevron, ARTBA will continue challenging regulatory overreach, undertaking or supporting litigation when necessary. As always, ARTBA will work with our members, chapters and colleague associations to ensure the industry’s views are heard by federal agencies and courts. Long term, we hope to see these new legal parameters ease the regulatory burden on our members as they seek to build projects safely, efficiently and cost-effectively.

For more information, please contact me at psharma@artba.org.