Administrative Conference of the United States
WAIVERS, EXEMPTIONS, AND PROSECUTORIAL
DISCRETION: AN EXAMINATION OF AGENCY
NONENFORCEMENT PRACTICES
Final Report: November 1, 2017

Aaron L. Nielson
J. Reuben Clark Law School
Brigham Young University

This report was prepared for the consideration of the Administrative Conference of the United States. The opinions, views and
recommendation expressed are those of the author and do not necessarily reflect those of the members of the Conference or its
committees, except where formal recommendations of the Conference are cited.

WAIVERS, EXEMPTIONS, AND PROSECUTORIAL DISCRETION:
AN EXAMINATION OF AGENCY NONENFORCEMENT PRACTICES

Aaron L. Nielson
J. Reuben Clark Law School
Brigham Young University

Report to the Administrative Conference of the United States
October 31, 2017

This report was prepared for the consideration of the Administrative Conference of the
United States. The opinions, views, and recommendations expressed are those of the
author and do not necessarily reflect those of the members of the Conference or its
committees, except where formal recommendations of the Conference are cited.

About the Author: Aaron L. Nielson is an associate professor at the J. Reuben Clark Law School, Brigham
Young University. He co-chairs the Rulemaking Committee of the American Bar Association’s Section of
Administrative Law & Regulatory Practice. Before joining the academy, Professor Nielson was a partner
in the Washington, D.C. office of Kirkland & Ellis LLP, where he remains of counsel. Each week he
authors a column for the Yale Journal on Regulation’s Notice & Comment blog that reviews the decisions
of the U.S. Court of Appeals for the District of Columbia Circuit.

WAIVERS, EXEMPTIONS, AND PROSECUTORIAL DISCRETION:
AN EXAMINATION OF AGENCY NONENFORCEMENT PRACTICES
Aaron L. Nielson
CONTENTS
Page
INTRODUCTION ............................................................................................................................... 1
I.

BACKGROUND: AGENCY NONENFORCEMENT .................................................................. 8
A.

The Administrative Procedure Act and Nonenforcement ........................... 10

B.

Judicial Consideration of Nonenforcement ................................................... 11

C.

Academic Consideration of Nonenforcement ............................................... 22

II. A TAXONOMY OF NONENFORCEMENT ................................................................................... 25
A.

Temporality and Nonenforcement .................................................................. 27

B.

Non-Temporal Nonenforcement Factors ....................................................... 28

C.

A Visual Taxonomy of Nonenforcement ........................................................ 32

III. STUDY FINDINGS ..................................................................................................................... 34



A.

Study Methodology ........................................................................................... 34

B.

General Survey Findings .................................................................................. 35

C.

Case Studies ........................................................................................................ 49

Associate Professor, J. Reuben Clark Law School, Brigham Young University. For excellent research
assistance, the author would like to thank Brook Ellis, Kyle Harvey, Mallorie Mecham, Neal Monson,
Joshua Prince, and Jordan Rex. The author also appreciates the assistance of Alyssa Dunbar and Nadeen
Saqer, two dutiful interns for the Administrative Conference of the United States (ACUS). Many thanks
are also due to Abigail Moncrief, who provided invaluable assistance in formulating this project and
assisting with survey design. The author also thanks Emily Bremer, Christopher Walker, and the team of
dedicated researchers at ACUS. Finally, the author is indebted to the many government officials who
generously shared their experience and insight. All errors, of course, are those of the author.

IV. RECOMMENDED BEST PRACTICES .......................................................................................... 59
A.

If Possible, Save Nonenforcement for “Special” Cases ................................ 60

B.

Greater Use of Retrospective Review.............................................................. 61

C.

Publicize Nonenforcement Programs, Policies, and Procedures ................ 62

D.

Publicize Nonenforcement Decisions and Encourage Comments ............. 64

E.

Use a Consistent Methodology, Including Written Justifications .............. 65

CONCLUSION ................................................................................................................................ 67
APPENDIX: SURVEY INSTRUMENT ................................................................................................ 68

INTRODUCTION
Every day, in countless ways, federal agencies take steps to ensure that regulated
parties comply with the law. For obvious reasons, a great deal of attention has been
paid to these agency efforts to see that those who have breached legal duties are
punished and that those who are tempted to cross the line are dissuaded from doing so.
In short, we pay attention when agencies “bring the hammer down.” 1
Yet agencies sometimes decide not to bring the hammer down. They decline to
enforce the law, either across the board or as applied to individual parties. An agency
may prospectively tell a regulated party that it can do acts that would otherwise be
punished, or it may retrospectively decline to bring enforcement actions against
completed breaches of legal duties. And even if proceedings have been initiated,
agencies sometimes allow procedural violations within those proceedings to pass by
without sanction. For purposes of this Report, such agency decisions to not “bring the
hammer down” are called nonenforcement decisions.
Although agency nonenforcement of legal duties—through means such as
waivers, exemptions, and prosecutorial discretion—has received less attention than
agency efforts to see that legal duties are complied with, it too is a critical aspect of
administrative law that calls out for study and reflection. After all, although
nonenforcement often can be beneficial and, in any event, at times may be inevitable, 2 it
also raises important questions about administrative predictability and fairness. As the
U.S. Court of Appeals for the D.C. Circuit has explained in the context of an agency
decision to waive a procedural requirement in a proceeding:
The criteria used to make waiver determinations are essential. If they are
opaque, the danger of arbitrariness (or worse) is increased. Complainants
the agency “likes” can be excused, while “difficult” defendants can find
themselves drawing the short straw. If discretion is not restrained by a
test more stringent than “whatever is consistent with the public interest

1 See, e.g., FTC Brings the Hammer Down on Trans Union Sales of Credit Info, CREDIT RISK MGMT. REP.,
Mar. 8, 2000, at 1.
2 See, e.g., Heckler v. Chaney, 470 U.S. 821, 831 (1985) (explaining that nonenforcement generally is

not subject to judicial review because it requires considering “whether agency resources are best spent on
this violation or another, whether the agency is likely to succeed if it acts, whether the particular
enforcement action requested best fits the agency’s overall policies, and, indeed, whether the agency has
enough resources to undertake the action at all”).

Waivers, Exemptions, and Prosecutorial Discretion:
An Examination of Agency Nonenforcement Practices
(by the way, as best determined by the agency),” then how to effectively
ensure power is not abused?3
The Administrative Conference of the United States (ACUS) has commissioned
this Report to examine agency nonenforcement of otherwise applicable legal
provisions.4 In particular, this Report’s purpose is to investigate waivers and
exemptions, as well as the related concept of prosecutorial discretion. The analysis is
intended to be both conceptual and empirical, and to be driven by a very practical goal:
identifying ways to improve the nonenforcement process. 5
The challenge presented by nonenforcement is easy to state but hard to solve. As
a general matter, agencies have a great deal of discretion whether to enforce legal
provisions.6 And like many types of administrative discretion, nonenforcement can be
used for laudable purposes. Because resources are finite, it is impossible for agencies to
investigate—much less bring enforcement actions against—every violation of statutory
or regulatory law. Nor would inflexible enforcement always be desirable. Sometimes
generally applicable laws are a poor fit for a particular situation: “‘It is impossible for
any general law to foresee and provide for all possible cases that may arise; and
therefore an inflexible adherence to it, in every instance, might frequently be the cause

3 NetworkIP, LLC v. FCC, 548 F.3d 116, 127 (D.C. Cir. 2008).
4 This Report was prepared for the consideration of the Administrative Conference of the United

States. The opinions, views, and recommendations expressed are those of the author and do not
necessarily reflect those of the members of the Conference or its committees, except where formal
recommendations of the Conference are cited.
5 Specifically, this Report “draws conceptual distinctions among waivers, exemptions, and
prosecutorial discretion; examines current practices in agencies that grant waivers and exemptions;
reviews statutory and doctrinal requirements; and makes concrete procedural recommendations for
implementing agency best practices.” Regulatory Waivers and Exemptions, ADMINISTRATIVE CONFERENCE OF
THE UNITED STATES, https://www.acus.gov/research-projects/regulatory-waivers-and-exemptions (last
visited Oct. 31, 2017).
6 See, e.g., David J. Barron & Todd D. Rakoff, In Defense of Big Waiver, 113 COLUM. L. REV. 265, 273

(2013) (“[J]udges have treated the decision not to enforce a statutory requirement in an individual case—
whether due to lack of resources, concerns about the complications the particular case presents, or any of
a myriad of other bureaucratic considerations—as an exercise of an agency’s general administrative
discretion. The agency’s organic statute, therefore, need not expressly confer such a power in order for
the agency to exercise it lawfully.”) (citations omitted); Heckler, 470 U.S. at 838 (Brennan, J., concurring)
(explaining that “in the normal course of events, Congress intends to allow broad discretion for its
administrative agencies to make particular enforcement decisions”).

2

Waivers, Exemptions, and Prosecutorial Discretion:
An Examination of Agency Nonenforcement Practices
of very great injustice.’”7 Yet at the same time, again as with other forms of discretion,
agency discretion regarding nonenforcement can be problematic. 8 Indeed, “a central
principle of administrative law is (or at least should be) that discretion can be
dangerous.”9 Even leaving aside weighty constitutional concerns about the President’s
duty to faithfully execute the law (which are beyond the scope of this Report),10
nonenforcement may encourage the appearance or perhaps even reality of unfairness
and irregularity, for instance when an agency decides to waive requirements for some
but not all regulated parties or where the result of nonenforcement is that a potential
beneficiary of the administrative scheme finds itself out of luck. 11 The challenge
therefore is to strike the proper balance between regulatory flexibility, on one hand, and
evenhanded, non-arbitrary administration of the law on the other.

7 Zachary S. Price, Enforcement Discretion and Executive Duty, 67 VAND. L. REV. 671, 701 (2014) (quoting

4 THE DEBATES IN THE SEVERAL STATE CONVENTIONS ON THE ADOPTION OF THE FEDERAL CONSTITUTION 111
(Jonathan Elliot. ed., 1836)); see also id. at 675 (“[A] central normative reason for separating legislative and
executive functions, as articulated by Montesquieu, the Federalist Papers, and other foundational sources,
is to create a safety valve that protects citizens from overzealous enforcement of general prohibitions.”);
Cf. Stephanos Bibas, The Need for Prosecutorial Discretion, 19 TEMP. POL. & C.R. L. REV. 369, 370 (2010)
(explaining how a policy of maximalist enforcement forced school officials to expel a third-grader who,
on instructions from her grandmother, carried a knife to school to cut her birthday cake).
See, e.g., Richard A. Epstein, Government By Waiver, NATIONAL AFFAIRS (2011),
https://www.nationalaffairs.com/publications/detail/government-by-waiver (last visited Oct. 31, 2017)
(arguing that waiver is dangerous because “when currying the favor of capricious government officials is
required for a person’s well-being or a firm’s very existence, government abuse becomes nearly
impossible to oppose”).
8

9 Christopher J. Walker, Against Remedial Restraint in Administrative Law, 117 COLUM. L. REV. ONLINE

106, 113 (2017); cf. Mach Mining, LLC v. EEOC, 135 S. Ct. 1645, 1652–53 (2015) (“We need not doubt the
EEOC’s trustworthiness, or its fidelity to law . . . [to] know—and know that Congress knows—that legal
lapses and violations occur, and especially so when they have no consequence.”).
10 See U.S. CONST. art. II, § 3 (stating that the president “shall take Care that the Laws be faithfully

executed”). Many scholars have addressed the constitutionality of nonenforcement. See, e.g., Price, supra
note 7; Robert J. Delahunty & John C. Yoo, Dream On: The Obama Administration’s Nonenforcement of
Immigration Laws, the DREAM Act, and the Take Care Clause, 91 TEX. L. REV. 781 (2013); Peter L. Strauss, The
President and Choices Not to Enforce, 63 LAW & CONTEMP. PROBS. 107 (2000); David Barron, Constitutionalism
in the Shadow of Doctrine: The President’s Non-Enforcement Power, 63 LAW & CONTEMP. PROBS. 61 (2000);
Dawn E. Johnsen, Presidential Non-Enforcement of Constitutionally Objectionable Statutes, 63 LAW &
CONTEMP. PROBS. 7 (2000). This Report does not delve deeply into this scholarship.
11 See, e.g., Ruth Colker, Administrative Prosecutorial Indiscretion, 63 TUL. L. REV. 877, 882 n.20 (1989)

(expressing concern about nonenforcement because “prejudice and unfairness are more likely to occur in
a discretionary process than in a highly structured one”).

3

Waivers, Exemptions, and Prosecutorial Discretion:
An Examination of Agency Nonenforcement Practices
In light of these competing concerns, it is important to understand the theoretical
underpinnings of nonenforcement (i.e., an agency decision to excuse, either
prospectively or retrospectively, a regulated party from an otherwise applicable legal
provision). This question has received some attention by courts and scholars. But it is
also important to understand how agency approaches to nonenforcement translate into
day-to-day decision-making. This practical question has received much less attention.
Hence, the time has come for an examination of the mechanics of nonenforcement, with
a focus on empirical reality. When it comes to nonenforcement, what factors do
agencies consider, and why do they consider them? What procedures do agencies use?
Who is involved in the process? Are there internal checks, and if so, what are they?
How often do regulated parties request nonenforcement, and how often are such
requests granted? Are agencies more willing to excuse certain types of conduct? And is
there judicial review? The value of nitty-gritty answers to such questions is apparent,
but, unfortunately information is also difficult to obtain.
The challenge is more difficult, moreover, because agencies themselves differ,
both in what Congress has allowed them to do and in culture, institutional design, and
function.12 Congress, for example, may explicitly authorize some agencies to “waive” 13
requirements and also explicitly set out the requirements and procedures for such
waivers.14 Yet Congress might also delegate authority to an agency to create its own
procedures, which may allow the agency to create its own “exemption” 15 scheme and

12 See, e.g., Jon D. Michaels, Of Constitutional Custodians and Regulatory Rivals: An Account of the Old and

New Separation of Powers, 91 N.Y.U. L. REV. 227, 233 (2016) (rejecting the account of “administrative
agencies as monolithic”); Dave Owen, Regional Federal Administration, 63 UCLA L. REV. 58, 64 (2016)
(explaining how agency organization may affect outcomes); Katherine A. Trisolini, Decisions, Disasters,
and Deference: Rethinking Agency Expertise After Fukushima, 33 YALE L. & POL’Y REV. 323, 328 (2015)
(“Agencies’ approaches to policy decisions will vary substantially depending upon their unique histories,
legal mandates, structures, and organizational cultures, all of which affect the balance struck between
conflicting demands for efficiency, reasoned analysis, and participation.”).
As explained below, “waiver” is the term that this Report uses when referring to explicit
permission to agencies from Congress to not enforce the law.
13

See, e.g., Zachary S. Price, Seeking Baselines for Negative Authority: Constitutional and Rule-of-Law
Arguments over Nonenforcement and Waiver, 8 J. LEGAL ANALYSIS 235, 267 (2016) (“In the new Every Student
Succeeds Act, for example, Congress has barred the Secretary of Education from disapproving key
waivers based on ‘conditions outside the scope of the waiver request’ and has further specifically barred
waiver conditions prescribing certain academic standards (as the Secretary sought to do through
conditional NCLB waiver).” (citing Pub. L. No. 114-95, § 8013 (2016)).
14

15 Also as explained below,

“exemption” is the term that this this Report uses when referring to
general delegations from Congress to agencies, which the agency then uses to create a nonenforcement

4

Waivers, Exemptions, and Prosecutorial Discretion:
An Examination of Agency Nonenforcement Practices
standards.16 Likewise, some agencies may attempt to insulate future conduct while
others may instead exercise prosecutorial discretion regarding past conduct; the two
types of nonenforcement can be similar but not the same. 17 Likewise, an agency may
choose to excuse a breach of a procedural requirement within a proceeding, but not
forego the proceeding altogether. Again, the agency is not bringing the hammer down,
but it is a different type of nonenforcement. Similarly, some agencies may forego
enforcement only at the request of the regulated party, while others may do so sua
sponte.18 Some agencies perhaps may use special processes for certain types of
nonenforcement while others may always use the same processes. And some agencies
might use ad hoc processes. In sum, just as it is a mistake to treat agencies as monoliths,
it is a mistake to treat nonenforcement as a monolithic concept.
One purpose of this Report therefore is to disaggregate the concept of
nonenforcement in hopes of creating a workable taxonomy, i.e., to identify the different
species and subspecies within the broader nonenforcement genus. In truth, there is a
wide variety of nonenforcement systems. Even within a single agency there can be a
number of different types of nonenforcement, sometimes each with its own
requirements. For instance, Congress has given the Federal Aviation Administration
(FAA) at least seven grants of waiver authority in Title 49 of the U.S. Code, and that is
not the full catalogue of the agency’s nonenforcement power.19

scheme—in other words, where the nonenforcement authorization is implicit rather than explicit. This
proper terminology is not clearly established in the literature or U.S. Code.
16 See, e.g., 47 C.F.R. § 1.3 (“The provisions of this chapter may be suspended, revoked, amended, or
waived for good cause shown, in whole or in part, at any time by the [Federal Communications]
Commission, subject to the provisions of the Administrative Procedure Act and the provisions of this
chapter. Any provision of the rules may be waived by the Commission on its own motion or on petition if
good cause therefor is shown.”). The statutory authority cited for this regulation provides that “[t]he
Commission may perform any and all acts, make such rules and regulations, and issue such orders, not
inconsistent with this chapter, as may be necessary in the execution of its functions.” 47 U.S.C. § 154(i).
17 See, e.g., Cristina M. Rodríguez, Constraint Through Delegation: The Case of Executive Control Over

Immigration Policy, 59 DUKE L.J. 1787, 1845 (2010) (distinguishing “ex ante legal channels” from “ex post
prosecutorial discretion”).
18 Compare 49 C.F.R. § 1180.4(f)(1) (“Upon petition of a prospective applicant, the Board may waive or

clarify a portion of these procedures.”), with 47 C.F.R. § 1.3 (“Any provision of the rules may be waived
by the Commission on its own motion or on petition if good cause therefor is shown.”).
19 The FAA’s nonenforcement authority is discussed below.

5

See infra, Part III.C(ii).

Waivers, Exemptions, and Prosecutorial Discretion:
An Examination of Agency Nonenforcement Practices
It is also important to understand how common nonenforcement is (whether
absolutely, relatively, or comparatively) and what types of actions are most likely to be
the subject of it. For example, some agencies may engage in the practice more often
than other agencies, and they may do so more often regarding certain types of conduct
than other types. By the same token, some agencies may engage in nonenforcement less
often than other agencies in absolute numbers, but yet still grant a higher percentage of
requests. And there may be some commonalities across agencies.
Accordingly, another purpose of this Report is to examine the day-to-day
exercises of nonenforcement authority across a number of agencies. To do this, the
Report analyzes survey data provided by nine agencies: the Alcohol and Tobacco Tax
and Trade Bureau (TTB) within the Department of the Treasury, the Community
Development Financial Institutions Fund (CDFI) within the Department of the
Treasury, the Consumer Financial Protection Bureau (CFPB), the Employee Benefits
Security Administration (EBSA) within the Department of Labor, the FAA within the
Department of Transportation, the Federal Motor Carrier Safety Administration
(FMCSA) within the Department of Transportation, the Federal Transit Authority (FTA)
within the Department of Transportation, the Mine Safety and Health Administration
(MSHA) within the Department of Labor, and the Pipeline and Hazardous Materials
Safety Administration (PHMSA) within the Department of Transportation. Likewise,
the author of this Report conducted in-person interviews with officials from the FAA,
MSHA, and TTB, plus a phone interview with officials from the CFPB. 20 Based on
information learned through these surveys and interviews, it is possible to gain a more
thorough understanding of the nonenforcement practices and procedures these
agencies use.
Although this Report does not offer a comprehensive account of nonenforcement
(a concept with innumerable applications) even for these agencies, the results of this
study nonetheless are fascinating. For instance, nonenforcement is remarkably
heterogeneous. The FAA, for example, receives hundreds (and sometimes even
thousands) of requests for nonenforcement each year. The MSHA, by contrast, received
64 requests in 2014. Similarly, the frequency of granting nonenforcement requests
varies a great deal across agencies. The FTA grants nearly 100% of certain types of
request for nonenforcement. The CFPB, however, has only once formally prospectively
allowed a party to engage in otherwise unlawful conduct, even though the agency has
20 Other agencies were asked to participate in the survey or to be interviewed but declined.

6

Waivers, Exemptions, and Prosecutorial Discretion:
An Examination of Agency Nonenforcement Practices
programs specifically designed to facilitate prudent nonenforcement. Likewise, the
FAA makes it a point to publicize their most important nonenforcement decisions. The
TTB, by contrast, essentially never reveals its nonenforcement decisions, in part because
tax information can be especially sensitive.
Unsurprisingly, in light of this
heterogeneity, agency terminologies vary widely. Agencies use words like “waiver”
and “exemption” in very different ways.
At the same, however, there are some similarities. The FAA, MSHA, and TTB
each stressed that the agency only engages in nonenforcement if the regulated party can
credibly guarantee that it has taken steps that will prevent the purpose of the law (e.g.,
safety) from being undermined. Thus, neither the FAA nor MSHA will engage in
nonenforcement if the proposed modification is not at least as protective as the legal
standard, and the TTB will not do so if it threatens revenue collection. Similarly,
officials recognized that nonenforcement discretion could be abused if it is treated too
lightly and some suggested that, to the extent reasonably possible, agencies should
change the underlying legal requirements themselves rather than simply allowing
exceptions to those requirements through nonenforcement. Along with the CFPB, these
agencies also recognized that there is little prospect of judicial review. Likewise, across
all the agencies that contributed to this Report, there are few examples of agencies sua
sponte engaging in prospective nonenforcement (i.e., excusing noncompliance with the
law before it has occurred); usually, they require a regulated party to petition or
otherwise ask for such treatment. That said, agencies are reticent to discuss
prosecutorial discretion, including whether it is done sua sponte.
Finally, this Report identifies best practices. Because nonenforcement decisions
are often left to agency discretion, it is important that agencies be able to exercise
nonenforcement discretion fairly and prudently. Accordingly, so long as it is
reasonable and lawful for them to do so, this Report urges agencies to:


Save nonenforcement for “special” cases, including by drafting criteria that
prioritize objective characteristics.



Eliminate outdated or otherwise ineffective regulatory requirements that
regularly necessitate nonenforcement.



Publicize their nonenforcement programs,
particularly for prospective nonenforcement.

7

policies,

and

procedures,

Waivers, Exemptions, and Prosecutorial Discretion:
An Examination of Agency Nonenforcement Practices



Publicize their nonenforcement decisions and encourage comments from
other affected entities.



Use consistent methodology and prepare written explanations of their
nonenforcement decisions, whether or not the decisions or explanations
themselves will be made publicly available.

Although these best practices are not silver bullets and may not be a great fit for
every agency or regulatory scheme, they should help regularize administrative
nonenforcement without imposing undue limits on agency discretion.
*

*

*

This Report proceeds as follows. Part I lays out the background, with particular
emphasis on the theoretical discussion to date surrounding nonenforcement. Part II
attempts to set forth a taxonomy of nonenforcement by distinguishing between waivers,
exemptions, and prosecutorial discretion, and by identifying different categories of each
(e.g., broad versus narrow, upon petition or sua sponte, etc.). Part III, in turn, is the
study. It begins by setting forth the methodology and then analyzes the survey data
and offers case studies based on the interviews with the CFPB, FAA, MSHA, and TTB.
Finally, this Report sets out a number of best practices in Part IV.
I.

BACKGROUND: AGENCY NONENFORCEMENT

When one thinks of administrative law, what often comes to mind is agency
efforts to enforce the law by punishing those who violate it and warning regulated
parties who might be tempted to do so to watch their steps.
At times, however, agencies decide not to enforce the law. Instead, they may
essentially excuse—either prospectively or retrospectively—violations of the law.
Sometimes they do this pursuant to express grants of authority, 21 including for reasons
that Congress has specifically deemed important.22 Sometimes, however, they do it
pursuant to implicit of grants of authority. For instance, if the agency simply does not
21 Congress, for instance, has included waivers in certain statutory grants of authority for decades
and they have been used “intensively since the G. H. W. Bush administration.” Edward H. Stiglitz, Forces
of Federalism, Safety Nets, and Waivers, 18 THEORETICAL INQUIRIES L. 125, 131 (2017).
22 For instance, for purposes of federalism, waiver to States have been used extensively in welfare and

healthcare schemes. See, e.g., Jessica Bulman-Pozen, Executive Federalism Comes to America, 102 VA. L. REV.
953, 1030 (2016).

8

Waivers, Exemptions, and Prosecutorial Discretion:
An Examination of Agency Nonenforcement Practices
have enough resources to do all that is asked of it, it necessarily will allow some
violations of the law to go unenforced. For purposes of this Report, an agency decision
to excuse, either prospectively or retrospectively, a regulated party from an otherwise
applicable legal provision is called nonenforcement.
For decades, Congress, courts, and agencies themselves have wrestled with how
best to address nonenforcement. After all, even if useful or even sometimes inevitable,
agency nonenforcement, like other discretionary powers, presents opportunities for
abuse and the appearance of irregularity.23 Nonenforcement, moreover, has become
more controversial in recent years,24 although even its critics generally recognize that it
may have appropriate uses.25 Accordingly, a balance must be struck. This section
addresses various efforts to do so, with particular focus on the language used by
Congress in the Administrative Procedure Act (APA)—and how federal courts have
construed that language—to address agency nonenforcement of the law.
Note that because nonenforcement is a broad concept, this background section
cannot address all conceivable aspects of it. For instance, a permit may be
conceptualized as a form of nonenforcement; after all, there is some prohibition yet, if a
permit is obtained, that prohibition no longer applies. Likewise, perhaps certain
compliance schemes at times could be conceptualized as nonenforcement, especially if
the agency allows regulated parties to rely on self-reporting without detailed
investigation by the agency. Examining in full every potential feature of administrative
law that may be deemed “nonenforcement” in some sense would be a herculean task.

See, e.g., Richard A. Rosen & David S. Huntington, Waivers from the Automatic Disqualification
Provisions of the Federal Securities Laws, 29 INSIGHTS, Aug. 2015, at 2, 3 (“In recent years, however, in the
wake of the financial crisis, the SEC has taken a harder look at the waiver process, denying waivers in
some high-profile cases and generating dissent among the Commissioners about the proper role of
waivers.”).
23

24 See id. at 6 (“Until a few years ago, the SEC routinely granted waivers when they were requested,

with little comment or dissent. Now, the Commissioners are increasingly outspoken and polarized on
decisions about waivers. The current policy debate on the appropriateness of granting waivers turns on
several core policy issues, and is divided among political party lines . . . .”).
25 See, e.g., Epstein, supra note 8 (“Although all selective waivers may be suspect, there are surely

some circumstances under which they are acceptable. Assume, for example, that all the applicants for a
new job were supposed to receive their application forms at the same time, but for some reason the
instructions were delivered to one applicant a day late. At this point, a waiver extending the deadline by
one day would redress an imbalance that arose through no one’s fault.”).

9

Waivers, Exemptions, and Prosecutorial Discretion:
An Examination of Agency Nonenforcement Practices
Indeed, ACUS has engaged in detailed evaluations of such topics as standalone
reports.26
A.

The Administrative Procedure Act and Nonenforcement

The APA, enacted in 1946, governs many (but not all27) aspects of administrative
law, including judicial review of agency action.28 A key feature of the APA, especially
as interpreted,29 is a presumption of reviewability.30 In application, this “presumption
of reviewability” means “statutes will not be held to preclude review unless there is
‘clear and convincing’ evidence that Congress intended to do so.” 31
Especially in light of a presumption of reviewability, one might think that
nonenforcement decisions would be subject to the same sort of searching judicial review
as enforcement decisions. After all, Section 704 declares that “final agency action” is
“subject to judicial review” so long as there is “no other adequate remedy in a court.” 32
“Agency action,” in turn, is defined to include “the whole or a part of an agency rule,
order, license, sanction, relief, or the equivalent or denial thereof, or failure to act.”33
Likewise, Section 706 commands a reviewing court to “compel agency action
unlawfully withheld.”34 Thus, so long as the other requirements of judicial review are
met, why wouldn’t an agency’s failure to enforce a legal provision ground a judicial
challenge?

See, e.g., Federal Licensing & Permitting, https://www.acus.gov/research-projects/federallicensing-and-permitting (last visited Oct. 31, 2017); Compliance Standards for Government Contractor
Employees – Personal Conflicts of Interest and Use of Certain Non-Public Information;
https://www.acus.gov/research-projects/compliance-standards-government-contractor-employees%E2%80%93-personal-conflicts-interest (last visited Oct. 31, 2017).
26

27 See, e.g., 5 U.S.C. § 553(a)(1) (excluding “military or foreign affairs” from rulemaking procedures).
28 See id. §§ 701–706.
29 See, e.g., Nicholas Bagley, The Puzzling Presumption of Reviewability, 127 HARV. L. REV. 1285 (2014)

(questioning the presumption as potentially inconsistent with the APA).
30 See, e.g., U.S. Army Corps of Eng’rs v. Hawkes Co., 136 S. Ct. 1807, 1816 (2016); Sackett v. EPA, 132

S. Ct. 1367, 1374 (2012).
31 Cass R. Sunstein, Reviewing Agency Inaction After Heckler v. Chaney, 52 U. CHI. L. REV. 653, 654–55
(1985) (internal citations omitted).
32 5 U.S.C. § 704.
33 Id. § 551(13) (emphasis added).
34 Id. § 706(1).

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Waivers, Exemptions, and Prosecutorial Discretion:
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The APA, however, imposes additional limits on judicial review—limits that
may be relevant to nonenforcement. In particular, Section 701 creates two categories of
unreviewable agency decisions: “(1) those in which the statute precludes review, and (2)
those in which agency action ‘is committed to agency discretion by law.’” 35 As Cass
Sunstein has explained, these provisions may create more questions than they answer.
If the law commits an unreviewable decision to an agency, has it not also, by definition,
precluded review?36 But if the specific statute does not say the agency has
unreviewable discretion, why wouldn’t the decision be reviewable, especially because
the APA empowers courts to review agency decisions for abuses of discretion? 37 The
APA, by its plain terms alone, does not appear to resolve this textual puzzle.
To be sure, to the extent that formal agency waivers or exemptions are
conceptualized as permits or licenses, the APA speaks to them.38 Formal grants of
licenses, although potentially conceptualized as nonenforcement (because the agency
allows the regulated party to do something that it otherwise forbidden), are technically
agency action and so reviewable (so long as other requirements are met). 39 But the APA
does not clearly speak to an agency’s decision to not bring an enforcement action.
B.

Judicial Consideration of Nonenforcement

In recent decades, the federal judiciary has not had many occasions to address
agency nonenforcement. Ever since the Supreme Court’s decision in Heckler v. Chaney,40
agency nonenforcement—or, rather, one type of agency nonenforcement, albeit an
especially important one (i.e., non-prosecution)—has been presumptively
unreviewable. That said, even after Heckler, there are a small number of examples of
judicial review of nonenforcement decisions.

35 Id. at 657 (citing 5 U.S.C. §§ 701(a)(1), (a)(2)).
36 See id.
37 See 5 U.S.C. § 706(2)(A) (authorizing a reviewing court to “hold unlawful and set aside agency
action, findings, and conclusions found to be . . . an abuse of discretion”).
38 See id. §§ 551 (6), (7), (9).
39 See, e.g., New World Radio, Inc. v. FCC, 294 F.3d 164, 172 (D.C. Cir. 2002) (rejecting a challenge to a

license for lack of standing).
40

470 U.S. 821 (1985).

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(i)

The Supreme Court’s Build-Up to Heckler v. Chaney

The Supreme Court has long struggled to define what the APA means by
“committed to agency discretion by law.” One of the Court’s most important efforts to
do so was in Citizens to Preserve Overton Park, Inc. v. Volpe, decided in 1971.41 There the
Court explained that the APA provision “is a very narrow exception” that merely bars
review “in those rare instances where ‘statutes are drawn in such broad terms that in a
given case there is no law to apply.’”42 Nothing in Overton Park’s analysis necessarily
commands that the “committed to agency discretion by law” standard for
nonenforcement decisions should be more pro-agency than for enforcement decisions.
And, indeed, after Overton Park was decided, the Supreme Court did review an agency
nonenforcement decision of the non-prosecution variety. In Dunlop v. Bachowski, the
Court held that a judge could order the Secretary of Labor to undertake an
investigation.43 Hence, for a time it appeared that perhaps the same sort of judicial
review analysis would apply in both enforcement and nonenforcement contexts.
(ii)

The Watershed Heckler Decision

And then came Heckler—one of the most important cases in administrative law.44
There, a group of death row inmates in Oklahoma and Texas were sentenced to die by
lethal injection.45 In response, they petitioned the Food and Drug Administration
(FDA), “claiming that the drugs used by the States for this purpose, although approved
by the FDA for the medical purposes stated on their labels, were not approved for use
in human executions.”46 Thus, they urged that the “FDA was required to approve the
drugs as ‘safe and effective’ for human execution before they could be distributed in
interstate commerce.”47 Indeed, they even called for “the prosecution of all those in the

41

401 U.S. 402 (1971).

42 Id. at 410 (quoting S. REP. NO. 79-752, at 26 (1945)).
43 421 U.S. 560 (1975).
44 See, e.g., Ashutosh Bhagwat, Three-Branch Monte, 72 NOTRE DAME L. REV. 157, 159 (1996) (“Heckler v.
Chaney stands as one of the modern landmarks of administrative law.”); Kenneth C. Davis, No Law to
Apply, 25 SAN DIEGO L. REV. 1, 2 (1988) (“The most important decision denying review of administrative
action on the ground of ‘no law to apply’ may now be Heckler v. Chaney . . . .”).
45 Heckler v. Chaney, 470 U.S. 821, 823 (1985).
46 Id.
47 Id.

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Waivers, Exemptions, and Prosecutorial Discretion:
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chain of distribution who knowingly distribute or purchase the drugs with intent to use
them for human execution.”48
The FDA disagreed with that “understanding of the scope of FDA” authority.49
But the FDA also concluded that even if it could grant such relief, it would not. The
agency reasoned that it does not bring enforcement actions against every “‘unapproved
use of approved drugs’” but rather—generally—only “‘when there is a serious danger
to the public health or a blatant scheme to defraud.’” 50 According to the FDA, use of
drugs for state-authorized execution did not satisfy that standard. 51
The inmates brought suit under the APA but the district court granted summary
judgment against them on the theory that agency decisions “‘to refrain from instituting
investigative and enforcement proceedings are essentially unreviewable by the
courts.’”52 The D.C. Circuit disagreed, reasoning that agency refusals to act are
considered “final agency action” under the APA, and the APA’s explicit exclusion of
judicial review for agency decisions “‘committed to agency discretion by law’” should
be read narrowly in light of the presumption of reviewability.53
The Supreme Court, per then-Justice Rehnquist, reversed. Specifically, the Court
concluded that the FDA’s “inaction was an unreviewable exercise of prosecutorial
discretion” because there was “‘no law to apply’”; “[s]uch decisions should therefore be
presumed unreviewable under the ‘committed to agency discretion’ exception to the
general rule of reviewability under the APA.”54 Rehnquist offered at least four reasons
for this conclusion. First, and most importantly, he explained that
an agency decision not to enforce often involves a complicated balancing
of a number of factors which are peculiarly within its expertise. Thus, the
agency must not only assess whether a violation has occurred, but
whether agency resources are best spent on this violation or another,
48 Id.
49 Id.
50 Heckler, 470 U.S. at 824–25 (citation not included in original).
51 Id. at 825.
52 Id. (internal citation omitted).
53 Id. at 825–26 (quoting 5 U.S.C. § 701(a)(2)).
54 Sunstein, supra note 31, at 662 (internal citations omitted).

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Waivers, Exemptions, and Prosecutorial Discretion:
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whether the agency is likely to succeed if it acts, whether the particular
enforcement action requested best fits the agency's overall policies, and,
indeed, whether the agency has enough resources to undertake the action
at all. An agency generally cannot act against each technical violation of
the statute it is charged with enforcing. The agency is far better equipped
than the courts to deal with the many variables involved in the proper
ordering of its priorities.55
Second, “when an agency refuses to act it generally does not exercise its coercive
power over an individual’s liberty or property rights, and thus does not infringe upon
areas that courts often are called upon to protect.”56 Third, “when an agency does act to
enforce, that action itself provides a focus for judicial review” in a way that is different
in kind from nonenforcement.57 And fourth, “an agency’s refusal to institute
proceedings shares to some extent the characteristics of the decision of a prosecutor in
the Executive Branch not to indict—a decision which has long been regarded as the
special province of the Executive Branch.” 58
The Court stressed, however, that the presumption is rebuttable, in particular
“where the substantive statute has provided guidelines for the agency to follow in
exercising its enforcement powers.”59 But without such “guidelines” from Congress,
the agency’s nonenforcement decision—as a rule—cannot be challenged. On this basis
the Court distinguished Dunlop,60 in which Congress had specifically ordered (using the
word “‘shall’”) the Secretary of Labor to undertake an investigation if certain predicate
requirements were met.61 The Court concluded with respect to the FDA that Congress

55 Heckler v. Chaney, 470 U.S. 821, 831–32 (1985).
56 Id. at 832.
57 Id.
58 Id.
59 Id. at 833; see also id. (“Congress did not set agencies free to disregard legislative direction in the

statutory scheme that the agency administers. Congress may limit an agency’s exercise of enforcement
power if it wishes, either by setting substantive priorities, or by otherwise circumscribing an agency’s
power to discriminate among issues or cases it will pursue.”).
60 Dunlop v. Bachowski, 421 U.S. 560 (1975).
61 Heckler, 470 U.S. at 833 (quoting 29 U.S.C. § 482).

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Waivers, Exemptions, and Prosecutorial Discretion:
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had not provided such “guidelines.” 62 The Court also suggested, in a footnote, that
certain types of nonenforcement may be too significant to escape review. 63
Justice Brennan concurred because every day “hundreds of agencies” make
“[i]ndividual, isolated nonenforcement decisions,” and Congress surely “has not
intended courts to review such mundane matters.”64 Yet he also emphasized that the
Court’s decision did not address situations in which “(1) an agency flatly claims that it
has no statutory jurisdiction . . . ; (2) an agency engages in a pattern of nonenforcement
of clear statutory language . . . ; (3) an agency has refused to enforce a regulation
lawfully promulgated and still in effect; or (4) a nonenforcement decision violates
constitutional rights.”65 Justice Marshall concurred in the judgment because although it
was “easy” to conclude that the FDA’s particular decision should not be reviewed, in
his view a “‘presumption of unreviewability’” goes too far. 66
(iii)

Post-Heckler Supreme Court Cases

Since Heckler, the Supreme Court has largely continued to take the position that
nonenforcement is not reviewable, at least when it comes to a decision not to bring an
enforcement action. That said, the Court has also concluded, albeit in somewhat
unusual circumstances, that nonenforcement sometimes is subject to review.
The Court has repeatedly reiterated Heckler’s presumption of nonreviewability.67
Even in finding the presumption overcome, moreover, the Court has stressed the

62 Id. at 835–37.

See, e.g., Michael Kagan, A Taxonomy of Discretion: Refining the Legality Debate About Obama's
Executive Actions on Immigration, 92 WASH. U. L. REV. 1083, 1098 (2015) (“In Heckler, the Supreme Court
suggested in a footnote that there is some threshold at which an executive’s exercise of discretion
becomes ‘so extreme as to amount to an abdication of its statutory responsibilities.’”) (quoting Heckler, 470
U.S. at 833 n.4).
63

64 Heckler, 470 U.S. at 839 (Brennan, J., concurring).
65 Id.
66 Id. at 840 (Marshall, J., concurring in the judgment).
67 See, e.g., Lincoln v. Vigil, 508 U.S. 182, 191 (1993) (reiterating Heckler); Webster v. Doe, 486 U.S. 592,

599–600 (1988) (same); Christopher v. SmithKline Beecham Corp., 567 U.S. 142, 157–58 (2012) (similar).
The Court also has made statements along these lines in the context of immigration. See, e.g., Arizona v.
United States, 567 U.S. 387, 396–97 (2012); Reno v. Am.-Arab Anti-Discrim. Comm., 525 U.S. 471, 484–85
(1999).

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Waivers, Exemptions, and Prosecutorial Discretion:
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presumption’s strength. In FEC v. Akins,68 for instance, the Court concluded that
notwithstanding Heckler, the agency was required to enforce certain disclosure
requirements. But the Court reached this conclusion only because federal law
“explicitly” required the agency to act.69
Yet Heckler does not extend to all agency refusals to act. In Massachusetts v.
EPA,70 for instance, the Court read Heckler narrowly—at least in one context. The
question in Massachusetts addressed the agency must regulate greenhouse gas emissions
under the Clean Air act. The Court largely concluded yes, and in so doing devoted
much of its analysis to its substantive interpretation of the statute. The Court, however,
also had to address a nonenforcement question. Certain entities petitioned the EPA to
regulate such emissions; the EPA concluded, however, that it lacked statutory authority
to do so and, in any event, that even if it did have such authority, it would not exercise
it.71 The Court thus had to address whether a denial of a petition for rulemaking (which
also is a decision to not act) should be treated the same as a decision to not bring an
enforcement action.
The Court concluded that the two situations are not comparable, even though
they both, in a sense, involve agency inaction. Although noting that the Court had
“repeated time and again” that “an agency has broad discretion to choose how best to
marshal its limited resources and personnel to carry out its delegated responsibilities,”
and, indeed, that such “discretion is at its height when the agency decides not to bring
an enforcement action,” the Court refused to apply the Heckler presumption:
There are key differences between a denial of a petition for rulemaking
and an agency’s decision not to initiate an enforcement action. In contrast
to nonenforcement decisions, agency refusals to initiate rulemaking “are
less frequent, more apt to involve legal as opposed to factual analysis, and
subject to special formalities, including a public explanation.” They
68 524 U.S. 11 (1998).
69 Id. at 26.

Justice Scalia, joined by Justices O’Connor and Thomas, disagreed: “The provision of law
at issue in this case is an extraordinary one, conferring upon a private person the ability to bring an
Executive agency into court to compel its enforcement of the law against a third party. Despite its
liberality, the Administrative Procedure Act does not allow such suits . . . .” Id. at 29–30 (Scalia, J.,
dissenting).
70 549 U.S. 497 (2007).
71 See id. at 513 (“Even assuming that it had authority over greenhouse gases, EPA explained in detail
why it would refuse to exercise that authority.”).

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Waivers, Exemptions, and Prosecutorial Discretion:
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moreover arise out of denials of petitions for rulemaking which (at least in
the circumstances here) the affected party had an undoubted procedural
right to file in the first instance. Refusals to promulgate rules are thus
susceptible to judicial review, though such review is “extremely limited”
and “highly deferential.”72
Although four justices dissented on other grounds, this analysis went without
rebuttal. A denial for a petition of rulemaking, although potentially conceptualized as
nonenforcement, thus falls outside Heckler.
(iv)

Recent Supreme Court Non-Answers

Recently, the Supreme Court was asked to address nonenforcement of the nonprosecution variety in litigation challenging the Obama Administration’s
nonenforcement of certain immigration laws. President Obama announced that a
subset of otherwise deportable immigrants would not be deported so long as they could
satisfy certain conditions.73 In a preliminary injunction posture, the Fifth Circuit
rejected that decision as unlawful.74 The Supreme Court granted certiorari and,
interestingly, in doing so directed the parties to brief “Whether the Guidance violates
the Take Care Clause of the Constitution, Art. II, § 3.” 75
In its brief to the Supreme Court, the United States repeatedly invoked Heckler—
arguing that “Heckler’s presumption of non-reviewability applies to decisions to defer
immigration enforcement action” and that “discretion to permit an alien to be ‘lawfully
present’ . . . is thus precisely the kind of agency judgment that is committed to DHS’s
discretion under Heckler.”76 Texas, joined by numerous other States, rejected this
72 Id. at 527–28 (quoting Am. Horse Protection Ass’n v. Lyng, 812 F.2d 1, 3–4 (D.C. Cir. 1987) and Nat’l

Customs Brokers & Forwarders Ass’n of Am. v. United States, 883 F.2d 93, 96 (D.C. Cir. 1989)).
73 See, e.g., Fact Sheet: Immigration Accountability Executive Action, THE WHITE HOUSE: PRESIDENT
BARACK
OBAMA
(Nov.
20,
2014),
https://obamawhitehouse.archives.gov/the-pressoffice/2014/11/20/fact-sheet-immigration-accountability-executive-action (“These executive actions . . .
prioritize deporting felons not families, and require certain undocumented immigrants to pass a criminal
background check and pay their fair share of taxes as they register to temporarily stay in the U.S. without
fear of deportation.”) (last visited Oct. 31, 2017).
74 See Texas v. United States, 809 F.3d 134 (5th Cir. 2015).
75 United States v. Texas, 136 S. Ct. 906, 906 (2016) (mem.).
76 Brief for the Petitioners at 36–37, United States v. Texas, 136 S. Ct. 2271 (2016) (mem.) (per curiam)

(No. 15-674), 2016 WL 836758; see also id. at 39 (“A ruling that the Guidance is reviewable because of longestablished consequences that it does not alter would eviscerate Heckler’s protection under [immigration

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Waivers, Exemptions, and Prosecutorial Discretion:
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argument: The new policy is “affirmative governmental action” rather than nonaction
because “it creates a massive bureaucracy to grant applicants lawful presence, related
benefits eligibility, and work authorization.”77 The Court, however, did not decide
which side had the better of the fight. Instead, it divided four to four and affirmed the
lower court decision while issuing no opinion.78
In a similar vein, the Supreme Court recently denied leave to file a bill of
complaint in an original case brought by Nebraska and Oklahoma against Colorado
challenging Colorado’s marijuana laws. 79 This complaint also raised, indirectly to be
sure, questions about federal nonenforcement because activities authorized by Colorado
violate federal law. The U.S. Department of Justice, however, has determined that, as a
matter of “prosecutorial discretion,” it generally will not enforce federal law so long as
certain conditions (i.e., “both the existence of a strong and effective state regulatory
system, and an operation’s compliance with such a system”) are satisfied. 80 The
Supreme Court has not addressed the validity of this nonenforcement.
(v)

Lower Court Litigation

Following Heckler and these cases, one might suppose that federal courts would
only rarely review nonenforcement decisions, if at all. And that is generally true.81
Certain types of nonenforcement, however, are reviewed. Although courts, for
instance, rarely review an agency’s decision to not bring an enforcement action, they are
more willing to review an agency’s decision to waive one of its own rules within a
proceeding that has already begun. Likewise, courts may review an agency’s decision
law], because the same consequences flow from countless discretionary decisions in immigration
enforcement.”).
77 Brief for the State Respondents at 39, United States v. Texas, 136 S. Ct. 2271 (2016) (mem.) (per

curiam) (No. 15-674), 2016 WL 1213267.
78 See United States v. Texas, 136 S. Ct. 2271, 2272 (2016) (mem.) (per curiam).
79 See Nebraska v. Colorado, 136 S. Ct. 1034, 1034 (2016) (mem.) (denying the Motion for Leave to File

a Bill of Complaint).
80 See Memorandum from James M. Cole, Deputy Att’y Gen., U.S. Dep’t of Justice, Guidance
Regarding Marijuana Enforcement 3 (Aug. 29, 2013), http://www.justice.gov/iso/opa/resources/
3052013829132756857467.pdf (last visited Oct. 31, 2017).
81 See, e.g., Baltimore Gas & Elec. Co. v. FERC, 252 F.3d 456, 458–59 (D.C. Cir. 2001) (“Chaney sets forth

the general rule that an agency’s decision not to exercise its enforcement authority, or to exercise it in a
particular way, is committed to its absolute discretion.”); Am. Gas Ass’n v. FERC, 912 F.2d 1496, 1505
(D.C. Cir. 1990) (broadly stating that “nonenforcement decisions are ordinarily unreviewable”).

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Waivers, Exemptions, and Prosecutorial Discretion:
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to not exercise its nonenforcement power, including its refusal to waive or exempt (as
noted above, an agency’s grant of waiver or exemption may be challenged, so long as
the other justiciability requirements are met). And, of course, sometimes courts
conclude that Heckler’s presumption is rebutted. Finally, at least in some courts, a
general policy of nonenforcement may be reviewable even if an individualized instance
of nonenforcement is not.
The D.C. Circuit’s decision in NetworkIP, LLC v. FCC82 is a good example of an
agency’s decision to not enforce a requirement within a proceeding. There, APCC
Services, Inc. (APCC) filed an informal complaint against NetworkIP, LLC and Network
Enhanced Telecom, LLP (which the D.C. Circuit collectively referred to as “NET”).
Unfortunately, “[o]n the absolutely last day it could be timely, . . . APCC unsuccessfully
attempted to file a formal complaint.” 83 There were two problems with APCC’s formal
complaint. First, APCC was required to submit two checks, not just one, because there
were two carriers at issue. And second, “the filing fee proffered for each defendant was
$5.00 short” because APCC did not read the latest version of the Code of Federal
Regulations before trying to file.84 About two weeks later, APCC filed a correct formal
complaint, which the FCC accepted. 85 The agency did so by invoking its waiver
authority: “Any provision of the rules may be waived by the Commission on its own
motion or on petition if good cause therefor is shown.” 86 The result of the agency’s
exercise of its waiver authority was that NET—deemed liable on the merits by the
Commission—was subject to an increase in liability.
NET challenged the FCC’s nonenforcement of the agency’s procedural rules.87
The D.C. Circuit “reluctantly” agreed with NET, despite “the deference we afford to an
agency’s decision whether to waive one of its own procedural rules.” 88 In particular,
the court explained that “before the FCC can invoke its good cause exception, it both
‘must explain why deviation better serves the public interest, and articulate the nature
82 548 F.3d 116 (D.C. Cir. 2008).
83 Id. at 125.
84 Id. at 125–26.
85 Id. at 126.
86 47 C.F.R. § 1.3.
87 NetworkIP, 548 F.3d at 126.
88 Id. at 127.

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Waivers, Exemptions, and Prosecutorial Discretion:
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of the special circumstances to prevent discriminatory application and to put future
parties on notice as to its operation.’”89 Because the power to waive procedural rules is
so important, the court demanded clear criteria to prevent “the danger of arbitrariness
(or worse).”90 After all, if the test is too ill-defined, “[c]omplainants the agency ‘likes’
can be excused, while ‘difficult’ defendants can find themselves drawing the short
straw.”91 The court concluded that there were no special circumstances as to APCC;
waiting until the last minute and then having something go wrong is too ordinary a
situation to merit a waiver of the rules.92
Another example of judicial review in the context of nonenforcement occurs
when an agency declines to exercise its nonenforcement authority, for instance by
refusing to grant a waiver. An excellent example of this is found in Blanca Telephone Co.
v. FCC,93 also decided by the D.C. Circuit. In this case, the FCC required digital wireless
service providers to offer handsets that could be used by those with hearing aids by a
certain date. Over one hundred of these providers petitioned the FCC to “waive the
deadline.”94 Exercising its waiver authority,95 the agency did so for a great many of
those providers but not for three of them. It concluded that those three had not
exercised enough diligence prior to the deadline to justify waiver. The three providers
then sought review on the ground that this “differential treatment” was not justified. 96
The D.C. Circuit sided with the agency, explaining that its review of a denial of a
waiver is “‘extremely limited’”97 and that it will vacate a denial only if, for instance, the

89 Id. (quoting N.E. Cellular Tel. Co. v. FCC, 897 F.2d 1164, 1166 (D.C. Cir. 1990)).
90 Id.
91 Id.
92 See id.
93 743 F.3d 860 (D.C. Cir. 2014).
94 Id. at 861.
95 See 47 C.F.R. § 1.925(a) (“The Commission may waive specific requirements of the rules on its own

motion or upon request.”); see also id. § 1.925(b)(3) (“The Commission may grant a request for waiver if it
is shown that: (i) The underlying purpose of the rule(s) would not be served or would be frustrated by
application to the instant case, and that a grant of the requested waiver would be in the public interest; or
(ii) In view of unique or unusual factual circumstances of the instant case, application of the rule(s) would
be inequitable, unduly burdensome or contrary to the public interest, or the applicant has no reasonable
alternative.”).
96 Blanca Tel., 743 F.3d at 862.
97 Id. at 864 (quoting BDPCS, Inc. v. FCC, 351 F.3d 1177, 1181 (D.C. Cir. 2003)).

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Waivers, Exemptions, and Prosecutorial Discretion:
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agency altogether “‘fails to provide adequate explanation before it treats similarly
situated parties differently.’”98 The court concluded that the agency’s decision satisfied
that standard.99 The D.C. Circuit has applied similar analysis in other cases. 100
There are also instances in which the Heckler presumption is rebutted. Consider
Cook v. FDA.101 Like Heckler itself, this case involved a lawsuit by “prisoners on death
row.”102 In particular, prisoners sued the agency “for allowing state correctional
departments to import sodium thiopental (thiopental), a misbranded and unapproved
new drug used in lethal injection protocols . . . .” 103 The agency eventually issued a
statement that “in ‘defer[ence] to law enforcement’ agencies, henceforth it would
exercise its ‘enforcement discretion not to review these shipments and allow processing
through [Customs’] automated system for importation.’”104 The prisoners thereafter
sought judicial review of the new policy. The D.C. Circuit distinguished Heckler,
because “even assuming the presumption against judicial review . . . does apply to the
FDA’s refusal to enforce [the statute], that presumption is rebutted by the specific
‘legislative direction in the statutory scheme.’” 105 The statute “sets forth precisely when
the agency must determine whether a drug offered for import appears to violate the
[Food, Drug, and Cosmetic Act], and what the agency must do with such a drug.” 106
Courts have applied this sort of analysis in other cases as well. 107

98 Id. (quoting Morris Commc’ns, Inc. v. FCC, 566 F.3d 184, 188 (D.C. Cir. 2009)).
99 See id. at 865-66.
100 See, e.g., Delta Radio, Inc. v. FCC, 387 F.3d 897, 901 (D.C. Cir. 2004) (“Given this limited review, we
hold that the FCC did not abuse its discretion in failing to grant Delta a waiver of its payment obligations
or in assessing the statutory default penalty when Delta failed to meet payment deadlines.”).
101 733 F.3d 1 (D.C. Cir. 2013).
102 Id. at 3.
103 Id.
104 Id. (alterations in original) (no citation in original).
105 Id. at 7 (quoting Heckler v. Chaney, 470 U.S. 821, 833 (1985)).
106 Id.
107 See, e.g., Nat’l Wildlife Fed’n v. EPA, 980 F.2d 765, 773–74 (D.C. Cir. 1992); Ctr. for Auto Safety v.

Dole, 828 F.2d 799, 803 (D.C. Cir. 1987) (“The Chaney Court said it was ‘leaving to one side the problem of
whether an agency’s rules might under certain circumstances provide courts with adequate guidelines for
informed judicial review of decisions not to enforce.’ This case, however, squarely presents that situation
in which an agency’s own regulations do contain a ‘judicially manageable’ standard for making
nonenforcement decisions.”) (citation omitted).

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Waivers, Exemptions, and Prosecutorial Discretion:
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Finally, some lower courts have held that even as to non-prosecution, there is a
difference between nonenforcement in an individual case and a policy of
nonenforcement. For instance, in the D.C. Circuit, “an agency’s statement of a general
enforcement policy may be reviewable for legal sufficiency where the agency has
expressed the policy as a formal regulation after the full rulemaking process . . . or has
otherwise articulated it in some form of universal policy statement . . . .” 108 Hence, for
example, in Edison Electric Institute v. EPA, the court concluded that an EPA
“Enforcement Policy Statement” could be reviewed because the “[p]etitioners [were]
not challenging the manner in which the EPA has chosen to exercise its enforcement
discretion” but instead were attacking the agency’s statutory interpretation. 109
C.

Academic Consideration of Nonenforcement

Although the academy has not devoted as much attention to nonenforcement as
it has to other aspects of administrative law, the subject has not gone unnoticed. 110 This
Report is not the place for an exhaustive review of the literature, especially because the
Report does not address the constitutional questions surrounding nonenforcement—
questions which, at least of late, have dominated the academic discussion. That said, it
is useful to examine some of the key insights from scholarship.
Unsurprisingly, the academic discourse focuses on many of the same questions
that have occupied the judiciary. Some appear to have advanced arguments that would
support robust discretion when it comes to nonenforcement, including notably Kenneth
Culp Davis, who observed that “[r]ules without discretion cannot fully take into
account the need for tailoring results to unique facts and circumstances of particular

108 Crowley Caribbean Transp., Inc. v. Peña, 37 F.3d 671, 676 (D.C. Cir. 1994) (emphasis in original)

(citations omitted); see also People for the Ethical Treatment of Animals, Inc. v. U.S. Dep’t of Agric., 7 F.
Supp. 3d 1, 10 (D.D.C. 2013) (explaining the exception).
109 996 F.2d 326, 333 (D.C. Cir. 1993).
110 See, e.g., Barron & Rakoff, supra note 6, at 276 (discussing waiver in some detail); Abbe R. Gluck,

Anne Joseph O’Connell & Rosa Po, Unorthodox Lawmaking, Unorthodox Rulemaking, 115 COLUM. L. REV.
1789, 1818 (2015) (briefly discussing waiver); Michael S. Greve & Ashley C. Parrish, Administrative Law
Without Congress, 22 GEO. MASON L. REV. 501, 535 (2015) (same). Prosecutorial discretion—including the
context of regulatory duties administered by federal agencies—has also received scholarly attention in
recent years. See, e.g., Peter L. Markowitz, Prosecutorial Discretion Power at its Zenith: The Power to Protect
Liberty, 97 B.U. L. REV. 489 (2017) (urging that discretion makes the most sense when it protects liberty);
Daniel Uhlmann, Prosecutorial Discretion and Environmental Crime, 38 HARV. ENVTL. L. REV. 159 (2014)
(examining such discretion empirically in environmental context).

22

Waivers, Exemptions, and Prosecutorial Discretion:
An Examination of Agency Nonenforcement Practices
cases. The justification for discretion is often the need for individualized justice.” 111
That analysis, although written about discretion generally, captures one of the key
underpinnings of nonenforcement discretion. Some amount of nonenforcement is
inevitable because of resource constraints.112 Looking for evidence of a violation when
that violation may or may not have occurred could, in theory, soak up infinite resources
since it is impossible to prove a negative. And even if a violation is known, it may not
be cost-effective to pursue it, especially if it means that other, more important violations
cannot also be pursued.
More provocatively, David Barron and Todd Rakoff have written in defense of
so-called “big waiver,” a concept that includes the idea that agencies should be able to
waive not just regulatory requirements of their own making but also statutory
requirements of Congress’s making. 113 They argue that “big waivers” are constitutional
and sometimes good policy: “Big waiver offers a salutary means of managing the
practical governance concerns that make traditional delegation unavoidable.” 114
Similarly, Leigh Osofsky—in the context of tax—has advanced the case for “categorical
nonenforcement,” i.e., “complete, prospective nonenforcement of some aspect of the
law.”115 Simply stated, she argues that if some nonenforcement is going to happen
anyway, there sometimes is value in doing so categorically. 116 And in the context of

111 KENNETH CULP DAVIS, DISCRETIONARY JUSTICE: A PRELIMINARY INQUIRY 17 (1969); see also id. at 43–
44 (arguing that eliminating “all discretion on all subjects would be utter insanity”). That said, it is
important to note that Professor Davis was skeptical of an absolutist position; for instance, he disagreed
with the Supreme Court’s decision in Heckler. See Davis, supra note 44, at 9 (“In light of the long history,
one may be reasonably sure that the Court's preference for the extreme Chaney view will not long
endure.”).
112 See, e.g., Michael Sant’Ambrogio, The Extra-legislative Veto, 102 GEO. L.J. 351, 381 (2014) (explaining
that some “laws that cannot achieve all their goals with the resources available”); Gillian E. Metzger, The
Constitutional Duty to Supervise, 124 YALE L.J. 1836, 1846 (2015) (listing “resource allocation” as a “[k]ey
component[] of administration”).
113 See Barron & Rakoff, supra note 6, at 267.
114 See id. at 270; see also id. (“Through big waiver, Congress takes ownership of the first draft of a

regulatory framework, confident that its handiwork will not prove to be rigid and irreversible.”).
115 Leigh Osofsky, The Case for Categorical Nonenforcement, 69 TAX L. REV. 73, 73 (2015).
116 See id. at 75–76 (“[I]n some circumstances categorical nonenforcement may actually increase the
legitimacy of the IRS’s nonenforcement.”).

23

Waivers, Exemptions, and Prosecutorial Discretion:
An Examination of Agency Nonenforcement Practices
immigration in particular, many scholars have urged that policy concerns should be
allowed to influence nonenforcement decisions. 117
At the same time, others have criticized nonenforcement, especially some
applications of it. Zach Price, among others, has expressed concern about policy-driven
nonenforcement, both as a constitutional matter and also for its normative
implications.118 If nonenforcement is applied too broadly (for instance, in the nonprosecution context, but not necessarily limited to that context), the Executive Branch
could essentially nullify a valid act of Congress.
Another concern, expressed by some, is that there are few “laws, procedures, or
assurances of transparency” for nonenforcement. 119 This lack of transparency can be
problematic. Likewise, an agency may use its nonenforcement power to achieve ends
not allowed by the statute; where the agency can pursue an enforcement action, it may
be able to leverage that power to force a regulated party to do something else the
agency wants, in hopes of avoiding an enforcement action. 120 That may be appropriate
if the agency’s goal is an end the law allows; for instance, if the agency agrees to waive a
safety requirement if the regulated party agrees to do something instead that is equally
safe but technically noncompliant. But it is something else altogether if an agency can
use the threat of an enforcement action to obtain an outcome that is not within its
statutory authority.121

117 See, e.g., Shoba Sivaprasad Wadhia, The Role of Prosecutorial Discretion in Immigration Law, 9 CONN.

PUB. INT. L.J. 243, 244 (2010) (“This article argues that prosecutorial discretion is both a welcome and a
necessary component of immigration law.”). But see Delahunty & Yoo, supra note 10, at 781 (challenging
whether broad nonenforcement is always permissible).
118 See, e.g., Price, supra note 7, at 671 (arguing that “the President’s nonenforcement authority extends

neither to prospective licensing of prohibited conduct nor to policy-based nonenforcement of federal laws
for entire categories of offenders”); Kate Andrias, The President’s Enforcement Power, 88 N.Y.U. L. REV.
1031, 1124–25 (2013) (“Though he has great latitude to influence enforcement policy, the President also
has an obligation to use his enforcement authority in a way that he can defend as consistent with the
law.”).
119 Gluck et al., supra note 110, at 1818.
120 See, e.g., Barron & Rakoff, supra note 6, at 277–78 (explaining that agencies “can condition its grant

of a waiver on an applicant’s satisfying requirements not otherwise required by statute”); Epstein, supra
note 8 (vigorously criticizing this practice as fundamentally contrary to rule-of-law values).
121 See, e.g., James V. DeLong, New Wine for a New Bottle: Judicial Review in the Regulatory State, 72 VA.

L. REV. 399, 428 (1986) (“A number of recent cases arguably involve agency efforts to leverage authority
from one area into another.”) (collecting citations); see also id. at 429 (“[T]he steady growth of the

24

Waivers, Exemptions, and Prosecutorial Discretion:
An Examination of Agency Nonenforcement Practices
Academics have also recognized that the whole idea of agency inaction versus
agency action (which goes to the heart of non-prosecution) may be problematic because
it can be difficult to draw a line between the two.122 At the same time, judicial review of
such nonenforcement can be institutionally challenging for courts, although Daniel
Walters has recently suggested that perhaps an APA “arbitrary and capricious”
approach would be desirable.123
To be clear, the academic discussion of nonenforcement goes beyond these
issues, especially to the extent that nonenforcement discretion is part of the larger
question of how to manage discretion.124 For purposes of this Report, however, this
discussion, through truncated, should suffice.
II. A TAXONOMY OF NONENFORCEMENT
As explained above, nonenforcement has not received a great deal of attention
from courts and academics. And when it is mentioned, all too often, it is treated as a
unitary concept. In fact, however, there is a wide variety of nonenforcement. And
different types of nonenforcement present different considerations. For instance, a
public decision to forego a substantive enforcement action against an already complete
violation of the law following a formal request by the lawbreaker is different in many
respects from a sua sponte decision by the agency to prospectively waive a procedural
requirement for a party that has not yet violated the law. This is not to say that
nonenforcement is more or less appropriate in one than the other. Rather, it is enough
to observe that the two situations are different and how one thinks about
Regulatory State has greatly increased the number of grants of authority that agencies may exploit. Also,
the very fact that there has been an explosion of regulatory authorities means that any specific statute,
and any specific exercise of authority, is less visible than it would have been two or three decades ago. In
a crowded forest, no tree stands out. Furthermore, even when an exercise of authority becomes visible,
legal doctrines that might limit the use of leveraging are not well-developed. For all of these reasons,
almost any grant of regulatory or program authority has the potential to become a valuable franchise for
an interest group or policy entrepenuer to acquire, even if the acquirer’s interests have little to do with
the ostensible purposes of the authority.”).
122 Jim Rossi, Waivers, Flexibility, and Reviewability, 72 CHI.-KENT L. REV. 1359, 1369–70 (1997).
123 See, e.g., Daniel E. Walters, The Judicial Role in Constraining Presidential Nonenforcement Discretion:
The Virtues of an APA Approach, 164 U. PA. L. REV. 1911 (2016) (identifying the difficulties with judicial
review of nonenforcement and urging a middle ground).

The “discretion question” may be the largest question of all in administrative law. See, e.g.,
Geoffrey C. Shaw, H. L. A. Hart’s Lost Essay: Discretion and the Legal Process School, 127 HARV. L. REV. 666,
668 (2013).
124

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Waivers, Exemptions, and Prosecutorial Discretion:
An Examination of Agency Nonenforcement Practices
nonenforcement—and how to safeguard it—might also be different in each. In short, an
agency’s decision to not “bring the hammer down” may arise in numerous contexts—
and they are not the same.
To be sure, some have recognized that there are different types of
nonenforcement. For instance, Leigh Osofsky has observed that how one views
nonenforcement may change depending on whether the decision is “technical” or
“policy-laden.”125 She also has focused on the differences between an agency decision
to engage in “categorical, or complete, prospective nonenforcement of some aspect of
the law” versus merely “setting low enforcement priorities.”126 Similarly, Kate Bowers
has differentiated “project-specific” waivers that are based on “individual
circumstances” from “[c]ategory-specific waiver[s]” that apply to a “designated
category” or even “a single law, such as the Energy Policy Act of 2005.” 127 She also has
recognized “[n]onspecific” waivers that give “general principles to guide” the
agency.128 The distinction between “big” and “little” waiver is similar. 129 Likewise,
Michael Kagan has organized nonenforcement along a spectrum in the context of
immigration, concluding that “[c]ongressionally authorized discretion” and
“[d]iscretion to not enforce the statute in every case” have the most legal support while
“[e]stablishing categorical criteria” may be most vulnerable to legal challenge. 130
This instinct to disaggregate nonenforcement is right. Such analysis, however,
can and should be expanded. To begin, it is important to evaluate nonenforcement
depending on timing, i.e., whether the unlawful conduct has occurred. An agency’s
125 Osofsky, supra note 115, at 112.
See also id. (“A comprehensive evaluation of executive
nonenforcement should take into account the different types of decisions that agencies make.”).
126 Id. at 73.

Kate R. Bowers, Saying What The Law Isn’t: Legislative Delegations Of Waiver Authority In
Environmental Laws, 34 HARV. ENVTL. L. REV. 257, 261–62 (2010).
127

128 Id. at 262.
129 Barron & Rakoff, supra note 6, at 277–78 (explaining that “little waiver” is “a limited power to

handle the exceptional case” while “big waiver” is authority to “substantially revise and not modestly
tweak”); see also id. (listing a number of types of considerations that may constitute “big waiver,”
including the Agency’s “authority to waive otherwise applicable statutory requirements, even absent an
application for a waiver,” its “authority to waive” without first “ascertaining the existence of specified
factual predicates,” its authority to “waive any part of the statute at issue” rather than just a set of specific
requirements, and whether its “authority to waive pertains to a substantial group of outside parties”).
130 See Michael Kagan, A Taxonomy of Discretion: Refining the Legality Debate About Obama’s Executive
Actions on Immigration, 92 WASH. U. L. REV. 1083, 1085–87 (2015).

26

Waivers, Exemptions, and Prosecutorial Discretion:
An Examination of Agency Nonenforcement Practices
decision to excuse a violation that has not occurred yet is different in kind 131 from an
agency’s decision to not enforce the law against a violation that has already happened.
Likewise, apart from timing, there are a wide range of situational considerations that
may go into evaluating a nonenforcement decision, including but not limited to those
identified above. Hence, the purpose of this section is to begin to create a taxonomy of
nonenforcement. Hopefully doing so will enable more meaningful evaluation.
A.

Temporality and Nonenforcement

One of the key distinctions that must be drawn is between nonenforcement when
the entity at issue has already violated a legal duty and when it has not. If the law has
already been violated, nonenforcement comes via prosecutorial discretion (or
something akin to it). If the law has not been violated, either waiver or exemption may
apply.
At this point is it useful to define some terms, at least for purposes of this Report.
There is an obvious difference between not enforcing the law against an already
complete violation and pledging to not enforce the law against a violation that has not
yet occurred. The former is an act of prosecutorial discretion; the latter is an act of
prospective authorization. Yet not all acts of prospective authorization are the same.
For instance, sometimes Congress has explicitly created a system that allows the agency
to give such prospective authorization. Other times, Congress has authorized, perhaps
implicitly, the agency to create its own procedures and internal rules, and from that
authorization the agency has created its own system to provide prospective
authorization. Of course, in a sense, these two situations are not categorically distinct
because an agency cannot do what Congress has not allowed; agencies (as a rule) do not
have inherent authority to act beyond what Congress has permitted.132

131 The law often distinguishes between acts that have occurred and those that have not.

One does
not go to jail for something that has not happened. Likewise, procedural options may change depending
on whether the action has occurred. See, e.g., Doran v. Salem Inn, Inc., 422 U.S. 922, 929 (1975).
e.g., HTH Corp. v. NLRB, 823 F.3d 668, 679 (D.C. Cir. 2016) (“[W]e have recognized that
agencies enjoy some powers that were not expressly enumerated by Congress. Although we have often
described these powers as ‘inherent,’ the more accurate label is ‘statutorily implicit.’”) (citations omitted).
That said, there may be some examples of inherent authority if the agency is exercising a core Article II
power. For purposes here, that is a distinction that does not matter; if the power is implied rather than
found in a statute, it is an exemption power rather than a waiver power.
132 See,

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Waivers, Exemptions, and Prosecutorial Discretion:
An Examination of Agency Nonenforcement Practices
Yet it is useful to distinguish between the two situations. For purposes of this
Report, where Congress has expressly authorized the agency to permit prospective
nonenforcement, the term “waiver” is used; by contrast, where the agency has acted
without an express grant of authority from Congress, the term “exemption” is used. As
it is now, the terms are often used fairly interchangeably or in ways that draw
distinctions that are not conceptual in character.133 That said, for reasons explained
below, although it is possible to draw such a conceptual distinction between “waivers”
and “exemptions,” it may not be worthwhile to do so. These types of nonenforcement
are sufficiently similar (and appear to be treated by agency officials as virtually
interchangeable) that distinguishing between them may not be worth the candle.
Another possible way to try to distinguish between waivers and exemptions is to say
that waivers apply to statutory requirements while exemptions apply to regulatory
requirements; that distinction also does not seem to be universally accepted, however.
Thus, for purposes of this Report, an agency can waive or exempt either a statutory or
regulatory requirement; the distinction is not the type of duty at issue but the textual
clarity of the agency’s grant of nonenforcement authority.
B.

Non-Temporal Nonenforcement Factors

Apart from time, there are many other situational factors to consider when
evaluating nonenforcement. The following ten factors (which, of course, are not
exhaustive134) are worth considering:
(i)

Who Makes the Decision?

To begin, it is useful to know who makes nonenforcement decisions.
Specifically, can the decision to engage in nonenforcement be made by agency staff or
must a political appointee do so? And if the decision is left to staff, is there a
meaningful right of appeal to the political appointee? Relatedly, it is useful to know
who has a part in the decision-making process, even if they are not the ultimate
deciders. For instance, if someone from outside of the agency plays a role, that may be
useful information. To the extent that nonenforcement decisions are controversial, one
133 See, e.g., What is a waiver?
An exemption?, FED. MOTOR CARRIER SAFETY ADMIN.,
https://www.fmcsa.dot.gov/faq/what-waiver-exemption (last visited Oct. 31, 2017) (stating a “waiver
provides the person with relief from the regulation for up to three months” while an “exemption
provides the person or class of persons with relief from the regulations for up to two years”).
134 Other potential factors, for instance, include the reasons for the violation, the consequences of

nonenforcement, the ease of identifying whether a violation has occurred, and agency design (e.g.,
whether enforcement is handled by a separate office). Undoubtedly there are others.

28

Waivers, Exemptions, and Prosecutorial Discretion:
An Examination of Agency Nonenforcement Practices
might think that they are important matters meriting greater political accountability. At
the same time, to the extent that one is concerned that the administrative process takes
too long, one might worry about appellate rights.
(ii)

The Nature of the Agency Judgment

One of the most important factors is whether the agency’s waiver decision is
merely technical or whether it is driven by policy. 135 As Professor Osofsky explains, an
agency “may make policy-laden decisions about whether to pursue business taxes
aggressively or not, as well as expertise-laden decisions about whether administrative
concerns preclude enforcement of a very technical tax provision.” 136 The public may
perceive nonenforcement differently in those two circumstances. This is not to say that
nonenforcement is necessarily more or less appropriate in one type of situation than
another; the answer to that question depends on one’s theory of how governmental
authority should be distributed. Some might argue, for instance, that policy-driven
nonenforcement is more dangerous, perhaps for constitutional reasons. 137 Others, by
contrast, may think that nonenforcement can act as a liberty-enhancing check on brightline laws, which may require some policy consideration. 138 This Report is not directed
at those higher-level questions; it is enough to observe that they exist. Of course,
separating decisions between “policy-laden” and “technical” is not a simple line to
draw; there is a spectrum. Indeed, it is difficult to imagine a purely “technical” decision
that does not have some policy implications.139 Even so, although it may not always be
possible to paint a clean line, the distinction is not worthless.
(iii)

The Source of the Legal Duty

Another important factor is the nature of the legal duty that the agency is
choosing not to enforce. More specifically, is the agency choosing not to enforce a legal
duty created by Congress in a statute, or does the duty come from the agency itself in a
regulation. (As noted, this one of the key demarcations between “big” and “little”
waivers.140) This distinction too, of course, is not always black-and-white. After all,
135 See, e.g., Osofsky, supra note 115, at 112 (distinguishing “technical” and “policy-laden” waivers).
136 Id.
137 See, e.g., Jeffrey A. Love & Arpit K. Garg, Presidential Inaction and the Separation of Powers, 112 MICH.
L. REV. 1195, 1216–17 (2014) (expressing concern about nonenforcement when used for policy reasons).
138 See, e.g., Michael Sant’Ambrogio, The Extra-legislative Veto, 102 GEO. L.J. 351, 361 (2014).
139 “A certain degree of discretion, and thus of lawmaking, inheres in most executive . . . action.”

Whitman v. Am. Trucking Assns., Inc., 531 U.S. 457, 475 (2001) (internal citations and punctuation
omitted).
140 See Barron & Rakoff, supra note 6, at 267.

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Waivers, Exemptions, and Prosecutorial Discretion:
An Examination of Agency Nonenforcement Practices
agencies cannot act without congressional authorization, and sometimes Congress
specifically commands the agency to issue a regulation. The distinction between
congressional and administrative action thus may be quite thin.
(iv)

The Instigation of Nonenforcement

Another factor is whether the agency has authority to engage in nonenforcement
sua sponte, i.e., on its own volition, or whether it must be made following the receipt of a
petition or other such device. Professors Barron and Rakoff consider authority to waive
legal duties sua sponte to be a “bigger” power.141 Prosecutorial discretion generally is
something that the agency can choose to do on a sua sponte basis. (Indeed, if the agency
simply chooses not to investigate, it may not even know that a violation has occurred.)
But when it comes to prospective nonenforcement, an agency with power to waive or
exempt noncompliance without a petition presumably has more discretion.
(v)

The Criteria to Evaluate Potential Nonenforcement

The clarity of the criteria used by the agency in making a nonenforcement
decision is also important.
Certain agencies, for instance, may have specific
requirements that must be met before the agency can engage in nonenforcement (e.g., as
discussed below, at some agencies a waiver or exemption can only be given if the
regulated party has proposed an alternative that is equally safe; likewise, there may be
other forms of conditional nonenforcement, i.e., if X is done, nonenforcement results).
By contrast, other agencies may have broad discretion; indeed some agencies have
authority to issue waivers based on “the public interest.” 142 In terms of authority, the
more flexible the standard, the more powerful the agency. Discretion, of course,
enables the agency to target nonenforcement with greater precision, but also increases
the risk of bias or at least the appearance of bias. And this too is a spectrum. 143
(vi)

The Breadth of Nonenforcement Across Entities

At the same time, it is also important to observe how many entities are affected
by the agency’s nonenforcement decision. An agency may decide to waive a
141 Id. at 277–78.
142 See, e.g., Sergio J. Galvis & Angel L. Saad, Collective Action Clauses: Recent Progress and Challenges

Ahead, 35 GEO. J. INT’L L. 713, 728 (2004) (explaining that “the SEC has authority to waive any provision of
the Trust Indenture Act for reasons of public interest”); 49 U.S.C. § 31315 (“The Secretary may grant a
waiver that relieves a person from compliance in whole or in part with a regulation issued under this
chapter . . . if the Secretary determines that it is in the public interest to grant the waiver and that the
waiver is likely to achieve a level of safety that is equivalent to, or greater than, the level of safety that
would be obtained in the absence of the waiver . . . .”).
143 Cf. Aaron L. Nielson, Beyond Seminole Rock, 105 GEO. L.J. 943, 968 (2017).

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Waivers, Exemptions, and Prosecutorial Discretion:
An Examination of Agency Nonenforcement Practices
requirement for a single entity, or it may do for an entire category of entities. 144 Both of
these approaches have pluses and minuses. When nonenforcement is limited to a single
entity, for instance, the aggregate amount of nonenforcement is less than when it
applies to a great number of entities. To the extent that compliance with the law is
valuable, this is a good thing. Yet if one worries about evenhandedness, categorical
nonenforcement may be superior, for instance because it requires drawing fewer
nuanced lines.145 For purposes here, it is enough to observe that the two are distinct.
(vii)

The Breadth of Nonenforcement for a Particular Entity

The breadth of nonenforcement for a particular entity also matters. For example,
an agency may choose to enforce parts of the law while leaving other parts of the law
unenforced, or it may choose not to enforce the law at all against that entity. Partial
nonenforcement raises different sorts of considerations than complete nonenforcement.
On one hand, it may be less objectionable because the violator is not wholly off the
hook. On the other hand, it may be more objectionable if it minimizes public scrutiny.
Likewise, an agency may elect to excuse a procedural violation in the midst of a
proceeding but not forego the proceeding itself.
(viii) Whether Nonenforcement Is Publicly Disclosed
Another factor is whether the agency’s nonenforcement programs, procedures,
and decisions are available to the public. Public scrutiny may be a check on abuse. 146
Publicity, however, may also create incentives for agencies to enforce the law even in
situations in which nonenforcement makes sense, if, for example, the explanation for
nonenforcement may be misunderstood or require disclosing sensitive information.
Few argue for complete transparency.147 Publicity, of course, is also not a binary
concept. An agency could make sure that its procedures for requesting and obtaining
nonenforcement decisions are public. It could also provide that all requests for
nonenforcement are public—either before the decision is made (thus potentially
allowing others to comment) or after the decision is made. Similarly, an agency could
generally make information about its nonenforcement decisions available, subject to
exceptions (for instance, if privacy is implicated).

144 To the extent that permitting is deemed nonenforcement, there may be a general or a specific
permit, for instance. See, e.g., Sierra Club v. U.S. Army Corps of Engr’s, 803 F.3d 31, 38 (D.C. Cir. 2015).
145 See, e.g., Osofsky, supra note 115.
146 See, e.g., T. Alex Aleinikoff, Non-Judicial Checks on Agency Action, 49 ADMIN. L. REV. 193, 195–96

(1997) (“Old-fashioned publicity is another significant check on agency action.”).
147 See generally Mark Fenster, The Opacity of Transparency, 91 IOWA L. REV. 885, 902–03 (2006) (setting
forth some of “transparency’s limits”).

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Waivers, Exemptions, and Prosecutorial Discretion:
An Examination of Agency Nonenforcement Practices

(ix)

Benefit to Agency

Another consideration is the question of what the agency “gets,” if anything, for
allowing nonenforcement. For instance, what must a regulated party do for the agency
to obtain a waiver? Is a waiver given as of right, or must a regulated party in a sense
“trade” for it by agreeing to do something else that the agency wants, perhaps
something not squarely related to the particular issue at hand (i.e., something “outside
of the program”)? One problem with nonenforcement is that an agency might leverage
its power to obtain ends that it may not be able to obtain otherwise within the law. To
the extent that the criteria are objective, an agency’s ability to leverage authority in this
way would be reduced (though of course not eliminated).
(x)

Whether There Is Judicial Review

Finally, it also is useful to know whether nonenforcement is subject to judicial
review. If the decision is subject to review, perhaps there is more reason to be confident
that agency discretion has not been abused because judicial review may serve a
disciplining role.148 Of course, this is not to say that a nonenforcement regime without
judicial review is always necessarily a worse one; review has costs of its own. 149 Yet in
evaluating whether a nonenforcement scheme is susceptible to abuse, judicial review
surely matters.150
C.

A Visual Taxonomy of Nonenforcement

When all of these factors are considered, a visual taxonomy of nonenforcement is
possible. To be sure, it is imperfect, especially because many of these factors are best
understood as a spectrum. Similarly, one can imagine other visual representations.
Even so, this is a useful way to visualize nonenforcement. For instance, one agency
may waive a statutory duty upon written request for a specific entity using specific
standards while providing notice to the public of its nonenforcement decision. Another
agency, by contrast, may exercise prosecutorial discretion sua sponte for a category of
entities by applying an open-ended standard, without providing any notice to the
public. Those two situations are distinct and should not be conflated. 151
148 See, e.g., Cass R. Sunstein, On the Costs and Benefits of Aggressive Judicial Review of Agency Action,

1989 DUKE L.J. 522, 529 (“[A] world without aggressive judicial review might well suffer from increases in
lawlessness, carelessness, overzealous regulatory controls, and inadequate regulatory protection.”).
149 See, e.g., Adrian Vermeule, Optimal Abuse of Power, 109 NW. U.L. REV. 673 (2015) (arguing that

some checks on discretion are not cost-justified).
150 Cf. William F. Pedersen, Jr., Formal Records and Informal Rulemaking, 85 YALE L.J. 38, 59–60 (1975).

To be clear, that conclusion is not the only one that can be drawn. For instance, categorical
nonenforcement may be less biased. See, e.g., Osofsky, supra note 115, at 73–75.
151

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Waivers, Exemptions, and Prosecutorial Discretion:
An Examination of Agency Nonenforcement Practices

Taxonomy of Nonenforcement
Pre-Violation

Agency Principals
Agency Staff
Policy-Driven
Technocratic
Statutory Duty
Regulatory Duty
Sua Sponte

Open-Ended

Categorical

Judicial
Review

Agency
Benefit

Public
Notice

Breadth
for
Entity

Criteria

Upon Request

Breadth
Across
Entities

Instigate

Legal
Duty

Policy
Nature

Who
Decides

Waiver

Specific

Individualized
Complete
Partial
No Public Notice
Public Notice
Within Program
Outside of Program

Unreviewable
Reviewable

33

Post-Violation
Exemption

Prosecutorial
Discretion

Waivers, Exemptions, and Prosecutorial Discretion:
An Examination of Agency Nonenforcement Practices

III. STUDY FINDINGS
With this conceptual understanding in mind, we can begin assessing how
agencies behave in the real world. How often do they engage in nonenforcement, and
is the rate comparable across agencies? What specifically drives nonenforcement
decisions, and are those factors consistent across agencies? Which agencies publicize
their procedures and decisions?
One of the purposes of this Report is to fill this knowledge gap. By examining
certain agencies, complete with survey information and interviews with agency
officials, it is possible to gain a better understanding of the nitty-gritty world of
nonenforcement. To be clear, this Report does not analyze every federal agency and
even within the agencies covered, it is possible that there may be additional types of
nonenforcement. Yet despite these limitations, this Report provides new insights, and it
also highlights areas where additional research would be valuable
A.

Study Methodology

This study was conducted in three parts. First, in consultation with research
assistants and through conversations with others, the author conducted a preliminary
investigation of nonenforcement powers and procedures at a large number of agencies.
This was done by reviewing the U.S. Code, the Code of Federal Regulations, law review
articles, and agency websites. The purpose of this initial step was to identify agencies
meriting additional research, for instance because they have robust nonenforcement
powers or because they seem representative of other sorts of agencies.
Following that initial step, the author, working with an ACUS staff member,
approached various agencies identified as potentially useful subjects. In particular, to
gain a better appreciation of the reality “on the ground,” the author prepared a survey
(included as the Appendix to this Report) that was sent to agencies that had indicated a
willingness to participate in the study. This survey poses questions about how the
agency at issue evaluates nonenforcement, and the various types of nonenforcement
powers it has. The survey is divided into five parts. First, it asks about the agency’s
statutory power to “waive” legal duties of private parties. Second, it asks about the
agency’s power to “waive” legal duties for States, i.e., so-called “federalism waivers.” 152
152 Unfortunately, the agencies that participated in the survey do not report meaningful use of this
type of waiver. Hence, it is not addressed in this Report.

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Waivers, Exemptions, and Prosecutorial Discretion:
An Examination of Agency Nonenforcement Practices
Third, it asks about the agency’s practices regarding “exemptions” from regulatory
schemes. Fourth, it asks about the agency’s practices regarding prosecutorial discretion,
i.e., decisions to not enforce the law against violations that have already occurred. And
fifth, it asks whether there are other sorts of nonenforcement programs worth
considering, plus whether those outside of the agency participate in the process,
whether the agency has best practices to recommend, and whether the agency has a
response to the analysis set out in the D.C. Circuit’s NetworkIP decision.153
Again working through ACUS, several follow-up messages were sent to agencies
in an effort to ensure robust participation in the survey. Following this effort, nine
agencies submitted a survey response.154 Unsurprisingly, not all agencies agreed to
answer every question posed in the survey. Even so, officials graciously answered most
of the questions and, importantly, often compiled and provided agency-specific data.
Following receipt of the completed surveys, the author—again in consultation
with an ACUS staff member—approached the agencies that participated in the survey
to ask whether they would be willing to participate in interviews, either in person or on
the telephone. Representatives of four agencies agreed: the CFPB, FAA, MSHA, and
TTB. To encourage a candid conversation, those interviews were not recorded. For
these interviews, however, the author was accompanied by either one of two ACUS
interns. These interns took detailed notes (which are on file with the author). The
purpose of this step was to generate several case studies of how specific agencies make
nonenforcement decisions. (Note, for this Report, the author has taken an agency’s
characterization of its authority as a given, e.g., the Report does not evaluate whether
practices are consistent with statutory authority or whether an agency’s characterization
of a power as granting waiver or exemption authority is accurate.)
B.

General Survey Findings

One of the most important findings from the survey is that agency practices
regarding nonenforcement vary widely.
Some agencies engage in robust
153 This question was included in the survey because the D.C. Circuit’s analysis is especially stark and
because, as noted above, there is little precedent involving nonenforcement.
154 As noted in the introduction, these agencies are: the TTB, CDFI, CFPB, EBSA, FAA, FMCSA, FTA,

MSHA, and PHMSA. Two of these agencies are within the Department of Treasury (TTB and CDFI), two
are within the Department of Labor (EBSA and MSHA), and four are within the Department of
Transportation (FAA, FMCSA, FTA, and PHMSA). The CFPB is “an independent bureau” that is
“established in the Federal Reserve System.” 12 U.S.C. § 5491(a).

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Waivers, Exemptions, and Prosecutorial Discretion:
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nonenforcement; others essentially never do. All the while, some agencies grant
requests quite often while others do so less frequently. Some agencies make their
decisions public; others do not. In short, because the administrative state is not
monolithic, with different agencies having different missions and histories, it is hardly
surprising that agency nonenforcement is also not monolithic. The survey, however,
illustrates just how diverse all of this really is.
Before addressing the substantive variety, however, it is important to recognize
another result that comes from the survey: agencies use very different vocabularies. As
explained above, for purposes of this Report, the terms “waiver” and “exemption” are
assigned specific definitions. Waiver authority is power explicitly granted to an agency
by Congress to prospectively not enforce either statutory or regulatory duties.
Exemption authority, by contrast, is implicit power to prospectively not enforce
statutory or regulatory duties because the agency has concluded (often by applying
equity-like principles) that such nonenforcement is necessary to effectuate its other
duties.155
Yet after even a few moments in the real world, it is obvious that these terms
have no fixed definitions. In fact, agencies may understand these terms at least
somewhat differently, and it is possible that officials even within the same agency
understand them differently. Nor has Congress consistently distinguished between the
the terms in legislation.156 Indeed, before the FAA could begin to fill out the survey, it
155 As explained above, the author recognizes that this distinction is not always easy to draw. By
definition, an agency cannot act without congressional authorization. The level of abstraction, however,
varies.
156 See, e.g., 49 U.S.C. § 31315(a), (b) (distinguishing between “waivers” and “exemptions,” in part, by
stating that waivers are of a shorter duration and exemptions apply to an individual person or class of
persons); 33 U.S.C. § 1223a(2) (distinguishing between “waivers” and “exemptions” by stating that
exemptions apply to a vessel while waivers apply to water bodies); 21 U.S.C § 360eee–1(3)(A)
(distinguishing between “waivers,” “exceptions,” and “exemptions,” with waivers allowing the agency to
not enforce “any of the requirements set forth in this section” where there is “undue economic hardship”
or “emergency medical reasons,” exceptions allowing the agency to change labeling requirements if there
is not enough space on the packaging, and exemptions apparently granting the agency catchall authority
“by which the Secretary may determine other products or transactions that shall be exempt from the
requirements of this section”); 22 U.S.C. § 9228(a), (b) (Congress itself declaring that certain “activities
shall be exempt from sanctions” but also stating that the President, in addition, “may waive” certain
sanctions); cf. 15 U.S.C. § 2617(f)(1), (2) (under the general category “waivers,” including no separate
discussion of waivers but instead including two subsections relating to “exemptions,” in which
subsections waivers are discussed); 42 U.S.C. § 3057e(c)(2) (“The Assistant Secretary shall provide
waivers and exemptions of the reporting requirements of subsection (a)(3) of this section for applicants
that serve Indian populations in geographically isolated areas, or applicants that serve small Indian

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Waivers, Exemptions, and Prosecutorial Discretion:
An Examination of Agency Nonenforcement Practices
required clarification regarding these terms. That said, although there is no welldefined line between waiver and exemption that commands universal approval, it
appears that agencies generally appreciate the distinction between prospective
nonenforcement (whether called waiver or exemption) and retrospective
nonenforcement (prosecutorial discretion). One takeaway from this Report, therefore,
may be that a distinction between waiver and exemption is not worth preserving, and
certainly not worth fighting about.157
(i)

Findings Regarding Waiver

To begin, a majority of the agencies that participated in the survey identified
authority to waive some statutory or regulatory requirements. In fact, FAA has so
many potential authorizations of waiver that it was unable to catalog them all; it
explained that “[t]he specific instances of statutory waiver authority are as varied as the
agency’s authority is broad, encompassing Title 49 of the United States Code Subtitle
VII and significant otherwise uncodified Public Laws.” 158 (The FAA did identify eight
distinct grants of waiver authority, seven from the same title of the U.S. Code, which are
discussed in more detail below.159) The PHMSA can waive both statutory and
regulatory duties under the Hazardous Materials Safety Program160 and the Pipeline
Safety Program,161 while the FMCSA has authority to not enforce motor carrier safety
populations, where the small scale of the project, the nature of the applicant, or other factors make the
reporting requirements unreasonable under the circumstances.”).
157 Given the taxonomy of nonenforcement set out above, it would be helpful to be able to map these

agency practices onto the taxonomy. Unfortunately, instances of nonenforcement can be sui generis and
the survey instrument was not detailed enough to capture the nuance. For the agencies that agreed to be
interviewed, the author was able to delve more deeply into some of the issues set out in the taxonomy but
even then, not at the detail necessary to map practices onto the taxonomy. Similarly, it is difficult to make
apples-to-apples comparisons across agencies.
158 FAA Survey Response (on file with author).
159 See infra, Part III.C(ii).
160 See 49 U.S.C. § 5117(a)(1) (“As provided under procedures prescribed by regulation, the Secretary
may issue, modify, or terminate a special permit authorizing a variance from this chapter or a regulation
prescribed under section 5103(b), 5104, 5110, or 5112 of this title to a person performing a function
regulated by the Secretary under section 5103(b)(1) in a way that achieves a safety level—(A) at least
equal to the safety level required under this chapter; or (B) consistent with the public interest and this
chapter, if a required safety level does not exist.”).
161 See id. § 60118(c)(1)(A) (“On application of an owner or operator of a pipeline facility, the Secretary

by order may waive compliance with any part of an applicable standard prescribed under this chapter
with respect to such facility on terms the Secretary considers appropriate if the Secretary determines that
the waiver is not inconsistent with pipeline safety.”); id. § 60118(c)(2)(A) (“The Secretary by order may

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Waivers, Exemptions, and Prosecutorial Discretion:
An Examination of Agency Nonenforcement Practices
regulations162 and the FTA may waive requirements for certain grants and “Buy
America” requirements.163 The MSHA has authority to grant modifications of mine
safety requirements under a process it calls “petitions for modification,” which is
discussed in greater detail below.164 Likewise, the TTB responded to the survey by
listing eight grants of statutory authority.165 Several of the laws administered by the
CFPB grant authority akin to what this Report refers to as “waivers,” but, as explained
below, the Bureau has not granted such waivers in its ordinary practice. The CDFI
reports that it does not have waiver authority, and the EBSA classifies its
nonenforcement authority as exemption authority rather than waiver authority. 166
Nevertheless, it is safe to say, at least de jure, that waiver authority is quite common.

waive compliance with any part of an applicable standard prescribed under this chapter on terms the
Secretary considers appropriate without prior notice and comment if the Secretary determines that—(i) it
is in the public interest to grant the waiver; (ii) the waiver is not inconsistent with pipeline safety; and (iii)
the waiver is necessary to address an actual or impending emergency involving pipeline transportation,
including an emergency caused by a natural or manmade disaster.”).
162 See id. § 31315(a) (“The Secretary may grant a waiver that relieves a person from compliance in

whole or in part with a regulation issued under this chapter or section 31136 if the Secretary determines
that it is in the public interest to grant the waiver and that the waiver is likely to achieve a level of safety
that is equivalent to, or greater than, the level of safety that would be obtained in the absence of the
waiver—(1) for a period not in excess of 3 months; (2) limited in scope and circumstances; (3) for
nonemergency and unique events; and (4) subject to such conditions as the Secretary may impose.”); id.
§ 31136(e) (“The Secretary may grant in accordance with section 31315 waivers and exemptions from, or
conduct pilot programs with respect to, any regulations prescribed under this section.”).
See id. § 5324(e) (“The Secretary may waive, in whole or part, the non-Federal share required
[under various provisions of federal law].”); id. § 5323(j)(2) (“The Secretary may waive paragraph (1) of
this subsection if the Secretary finds that—(A) applying paragraph (1) would be inconsistent with the
public interest; (B) the steel, iron, and goods produced in the United States are not produced in a
sufficient and reasonably available amount or are not of a satisfactory quality; (C) [complex formula for
rolling stock procurement]; (D) including domestic material will increase the cost of the overall project by
more than 25 percent.”). The FTA also has nonenforcement authority regarding emergencies; it is unclear
whether that authority should be deemed waiver authority or exemption authority. See id. § 5324(d).
163

164 See infra Part III.C(iii).
165 See 26 U.S.C. §§ 5181(b), 5201(b), 5312, 5417, 5554, 5556, 5561, 5162.
166 EBSA Survey Response (on file with author).

For what it is worth, one might classify at least some
of the EBSA’s authority as “waiver” rather than “exemption” authority because Congress expressly
allows the agency to not enforce the law. See 5 U.S.C. § 8477(c)(3) (“The Secretary of Labor may, in
accordance with procedures which the Secretary shall by regulation prescribe, grant a conditional or
unconditional exemption of any fiduciary or transaction, or class of fiduciaries or transactions, from all or
part of the restrictions imposed by paragraph (2).”). That said, because Congress called it an
“exemption,” and the agency did too, this Report will discuss such power in the next section.

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Waivers, Exemptions, and Prosecutorial Discretion:
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De facto, the exercise of waiver authority differs a great deal. Indeed, the number
of requests for waiver reported by these agencies varied markedly—no doubt because
the nature of the regulatory missions of the relevant agencies also differ markedly, The
TTB, for instance, reports that it receives “[l]ess than 25” requests for a waiver in any
typical year, despite having eight potentially applicable statutes. 167 The PHMSA, by
contrast, receives over 1,800 requests relating to hazardous materials alone. 168 The
FMCSA listed just eight requests for waivers in a single year, and the MSHA receives
approximately 50 per year (it reported 42 in one year and 64 in another). The FAA does
not record the number of waiver requests that it receives (as explained below, however,
the FAA does record the number of exemption requests that it receives, and the number
is in the thousands).
Agencies vary in the percentage of requests that they grant. The FMCSA says it
grants virtually all requests (“99 percent”), 169 as does the FTA for its two express
statutory bases for nonenforcement.170 By contrast, the MSHA grants a much smaller
percentage—somewhere in the range of 36%.171 (As discussed in greater detail below,
sometimes a request is neither granted nor denied. Instead, the request is withdrawn
because the mine is able to find another approach to the problem that does not require a
waiver.172) The PHMSA simply says the grant rate “[v]aries,”173 and the FAA has only

167 TTB Survey Response (on file with author).
168 PHMSA Survey Response (on file with author). Almost half of these, however, were request for
renewals. The agency typically receives less than ten special permit requests for pipelines.
169 FMCSA Survey Response (on file with author).
170 See FTA Survey Response (on file with author) (reporting “[c]lose to 100%” under one and that it

“has not denied any waive requests since passage of the FAST Act”).
171 MSHA Survey Response (on file with author).
172 It is interesting that some agencies essentially always grant waivers when requested and some do

not. It is hard to draw any real conclusions from this, however, at least based on the raw data alone.
Much, no doubt, depends on the nature of the duty being waived. Similarly, it is possible that regulated
parties might learn over time what types of requests are granted and which types are not, and so engage
in “self-sorting” before filing. Likewise, some regulated parties may engage in informal discussion with
the agency that lets them know whether a waiver would likely be granted; if that happens with some
agencies more than others, a cross-agency comparison may be misleading. These sorts of questions
should be the focus of additional research.
173 PHMSA Survey Response, supra note 168.

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Waivers, Exemptions, and Prosecutorial Discretion:
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recently “begun tracking waiver requests, but does not currently have enough data to
reflect a typical year.”174 The TTB grants “[a]pproximately 85%” of requests. 175
Similarly, of the agencies that report having waiver authority, sua sponte waiver
of statutory or regulatory duties appears to be, in the FAA’s words, “rare.”176 Indeed,
the PHMSA, MSHA, and TTB say they never exercise waiver authority without a
request. The FMCSA says it has only does so “once to date,” and that was only a
“limited 90-day waiver” of certain “hours-of-service regulations.” 177 The FTA too only
reports one such sua sponte waiver: “Subsequent to Hurricane Sandy, FTA issued
blanket waivers for several statutory and regulatory provisions.” 178 To the extent that
these agencies are representative of agencies generally, it thus appears uncommon for
an agency to prospectively forego enforcement without a request from a regulated
party for it to do so.
Agency procedures also vary. For instance, Congress set forth specific
requirements for the PHMSA (including both procedural and substantive
requirements),179 and, interestingly, has also ordered the agency to deal with
applications “promptly.”180 Congress also specified how long such nonenforcement can

174 FAA Survey Response, supra note 158.
175 TTB Survey Response, supra note 167.
176 See FAA Survey Response, supra note 158 (“The FAA has granted waivers under Title 51 without a

request but they are rare.”) (minor typographical error omitted).
177 FMCSA Survey Response, supra note 169.
178 FTA Survey Response, supra note 170.
179 See 49 U.S.C. § 5117(b) (“When applying for a special permit or renewal of a special permit under
this section, the person must provide a safety analysis prescribed by the Secretary that justifies the special
permit. The Secretary shall publish in the Federal Register notice that an application for a new special
permit or a modification to an existing special permit has been filed and shall give the public an
opportunity to inspect the safety analysis and comment on the application. The Secretary shall make
available to the public on the Department of Transportation’s Internet Web site any special permit other
than a new special permit or a modification to an existing special permit and shall give the public an
opportunity to inspect the safety analysis and comment on the application for a period of not more than
15 days.”).
180 See id. § 5117(c) (“The Secretary shall issue or renew a special permit or approval for which an

application was filed or deny such issuance or renewal within 120 days after the first day of the month
following the date of the filing of such application, or the Secretary shall make available to the public a
statement of the reason why the Secretary’s decision on a special permit or approval is delayed, along
with an estimate of the additional time necessary before the decision is made.”).

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An Examination of Agency Nonenforcement Practices
continue.181 And as to pipelines, Congress specifically requires the PHMSA to give a
reason for granting a waiver.182 The FMCSA requires a showing of equivalent safety,
but has different limits; a waiver cannot exceed three months, must be “limited in scope
and circumstances,” must be “for nonemergency and unique events,” and will be
“subject to such conditions as the Secretary may impose.” 183 The FTA for its part will
seek public comment and “will issue a formal determination, which also is published in
the Federal Register.”184 (The process used by the FAA, MSHA, and TTB is explained
below.)
Finally, some but not all of these agencies make their waiver decisions public.
The TTB, for instance, does not because “the decisions are fact-specific, and disclosure
rules under the Internal Revenue Code generally prevent the agency from publicizing
the decisions.”185 Similarly, the FMCSA reports that it has authority “to grant shortterm waivers for special situations without providing public notice.”186 The MSHA, by
contrast, “publishes all petitions for modification, as well as all granted modifications,
in the Federal Register,” and “publishes all decisions (or dispositions of any type) on its
website.”187 The FTA also “publishes requests for waivers and responses in the
emergency relief docket on www.regulations.gov,” and publishes other types of
decisions on its own webpage or in the Federal Register. 188 The PHMSA also makes its
181 See id. § 5117(a)(2) (“A special permit issued under this section shall be effective for an initial

period of not more than 2 years and may be renewed by the Secretary upon application for successive
periods of not more than 4 years each [subject to certain exceptions].”).
See id. § 60118(c)(3). As to pipelines, Congress also set out both substantive and procedural
requirements; the agency, for instance, must show that waiver “is not inconsistent with pipeline safety”
and can only act “after notice and an opportunity for a hearing,” unless there is an emergency, in which
case the agency can act without a hearing but must show “the waiver is necessary to address an actual or
impending emergency involving pipeline transportation, including an emergency caused by a natural or
manmade disaster.” Id. § 60118(c). Such emergency waivers “may be issued for a period of not more than
60 days and may be renewed . . . only after notice and an opportunity for a hearing on the waiver,” and
the agency “shall immediately revoke the waiver if continuation of the waiver would not be consistent
with the goals and objectives of this chapter.” Id. § 60118(c)(2)(B).
182

183 49 U.S.C. § 31315(a). The agency has supplemented the statute with more detailed regulations. See
49 C.F.R. § 381.210. The FMCSA then endeavors to provide an answer within 120 days.
184 FTA Survey Response, supra note 170 (discussing 49 U.S.C. § 5323(m)(3) and 49 C.F.R. § 661.7).
185 TTB Survey Response, supra note 167.
186 MSHA Survey Response, supra note 171.
187 FMCSA Survey Response, supra note 169.
188 FTA Survey Response, supra note 170.

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Waivers, Exemptions, and Prosecutorial Discretion:
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decisions publicly available—indeed, Congress requires it.189 And as explained in
greater detail in subsection (ii), “the FAA publishes those decisions in the Federal
Register that are novel, significant, or are of first impression to alert the public to such
determinations.”190
(ii)

Findings Regarding Exemptions

There also is a healthy exemption practice across agencies. The PHMSA
responded that its “hazardous materials approvals program could potentially be
considered to fall under the category of ‘equitable exemptions,’ insofar as it is not
specifically listed in Chapter 51 of Title 49 of the U.S. Code.” 191 This process involves
“written consent, including a competent authority approval, from the Associate
Administrator or other designated Department official, to perform a function that
requires prior consent under the Hazardous Materials Regulations,” and can apply to
“a wide array of activities in the hazardous materials industry.” 192 The FAA, in turn,
reports that it has “a robust practice,” especially because the agency included its
treatment of “small unmanned aircraft systems”—often referred to as drones—as part
of its exemption regime.193 The TTB, FTA, CFPB and CDFI report that they do not have
agency-created procedures to permit non-compliance that do not have an express
statutory basis.
The number of exemption requests, moreover, can be astounding. The PHMSA,
for instance, reports that it receives “[a]pproximately 16,000” requests per year, of
which it grants between 70% to 85% depending on the type. 194 Since August 2016,
when “the FAA published a final rule allowing civil operation” of unmanned aircraft
systems under a set weight, it has received over 16,000 requests; of those, it has denied
over 7,500 and granted about 4,000, and the rest remain pending. 195 Under other
programs, it “receives approximately 400-500 requests for exemption per year,” of
189 PHMSA Survey Response, supra note 168.

See also 49 U.S.C. § 5117(b).

190 FAA Survey Response, supra note 158.
191 PHMSA Survey Response, supra note 168.
192 Id.
193 FAA Survey Response, supra note 158.
194 PHMSA Survey Response, supra note 168.

Requests involving explosives do better than those

involving fireworks. See id.
195 FAA Survey Response, supra note 158.

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Waivers, Exemptions, and Prosecutorial Discretion:
An Examination of Agency Nonenforcement Practices
which it grants 73%.196 The FMCSA receives about 1,100 requests per year, and grants
about 58%.197 The EBSA noted that it has not granted any exemptions in 2017 (at least
as of July 31, 2017), but that it typically receives less than 100 requests per year, which
are spread across different programs.198 However, for some types of exemptions, it
grants about half of applications, whereas for applications that seek a reduction in civil
penalties it grants less than 5%. 199
As with waivers, it appears that agencies do not often grant exemptions without
a petition or application. The PHMSA, for instance, says it never does so 200; the FAA
says it generally does not, but that sometimes it will. 201 The EBSA reports that between
2012 and 2016, the agency “granted an exemption without a formal applicant
approximately 9 times (2 new exemptions and 7 amendments to existing exemptions),”
but also stressed that “[i]t is unlikely that EBSA would propose an individual
exemption on its own motion.202 The FMCSA has only done so “once to date.”203

196 Id.
197 FMCSA Survey Response, supra note 169.
198 EBSA Survey Response, supra note 166.
199 See id. (explaining that the EBSA may approve three types of exemptions: exemptions allowed by

§ 408(a) of the Employee Retirement Income Security Act of 1977 and § 4975(c)(2) of the Internal Revenue
Code or traditional exemptions, expedited exemptions, and 502(l) petitions; the agency estimates that it
granted about 59 traditional exemptions, 29 expedited exemptions, and ten 502(l) petitions between 2007
and 2011, and that it granted about 54% of traditional exemption requests, 46% of the expedited requests,
and about 5% of the 501(l) petitions, at least partially).
200 PHMSA Survey Response, supra note 168.
201 See FAA Survey Response, supra note 158 (“Our exemption process, outlined in 14 CFR part 11, is
well known in the industry. Typically, a petitioner requests exemption from a specific regulation (by
section) for a limited period of time. The request must include what actions the petitioner plans to take to
maintain a level of safety equivalent to that provided by the regulation, and why a grant would be in the
public interest. In some instances, a petitioner will err in its assessment of what regulation applies to its
situation or what relief it requires. In those instances, the FAA may grant relief from the necessary
sections, explaining the issue in its disposition. Field personnel of the FAA may direct noncompliant
operators to apply for an exemption when discrepancies are found.”).
202 EBSA Survey Response, supra note 166.
203 FMCSA Survey Response, supra note 169.

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The requirements for exemptions, like waivers, also vary. The PHMSA, for
example, has a “desk guide,” among other resources, dedicated to the question. 204 The
FAA requires that requests be submitted on a public docket, and “[m]ost requests are
reviewed by an attorney in the Regulations Division of the FAA’s Office of the Chief
Counsel.”205 The FMCSA’s procedures are similar; it also has an office that is
“responsible for reviewing exemption requests and making recommendations to the
Administrator.”206 The EBSA’s procedures vary, depending on the type of exemption at
issue.207 Each of these agencies generally makes its decisions publicly available.

204 PHMSA Survey Response, supra note 168; see also DEP’T OF TRANSP., PHMSA APPROVALS PROGRAM
DESK GUIDE (2016), https://www.phmsa.dot.gov/approvals-and-permits/hazmat/approvals-programdesk-guide (last visited Oct. 31, 2017).
205 FAA Survey Response, supra note 158.
206 FMCSA Survey Response, supra note 169.
207 EBSA Survey Response, supra note 166. According to the agency’s survey response, it reviews
written requests that comply with the regulations in 29 C.F.R. § 2570, and asks questions or requests
further information “to the extent the application is deficient or raises additional questions.” Id. at 3.
Generally, an application for a traditional exemption should include “[a] detailed discussion of the
exemption transaction and relevant background facts,” the reasons why a plan would enter into the
exemption transaction, complete descriptions of the prohibited transactions involved, and any other
requested evidence. Id. This will all become part of the administrative record. Id. Applications are
granted when, after careful evaluation, the exception “would be administratively feasible, in the interests
of the plan and of its participants and beneficiaries, and protective of the rights of the participants and
beneficiaries . . . .” Id. at 4. A notice of final exemption is then published in the Federal Register. Id. And
if the agency cannot make its required findings, applicants are notified in writing of tentative
determinations as well as the reasoning behind the decision. Id. at 3.

The main difference with an expedited application is the applicant may receive a “final authorization
to engage in a transaction on a prospective basis” as little as 78 days after the application is received and
acknowledged by the agency. EBSA Survey Response, supra note 166, at 4. However, the applicant must
also show that the proposed transaction is substantially similar with either two exemptions that were
granted within the last five years, or one exemption that was granted within the last ten years and a final
authorization received in the last five years. Id. If the applicant is unable to do so, the agency offers the
applicant the ability to convert the application into a traditional application. Id. But if the agency grants
tentative authorization, the applicant is required to deliver notice to all interested parties, informing them
of their right to submit comments or to request a hearing. Id. Then, after considering the commenters’
input, EBSA may grant an exemption. Id. No notice is published in the Federal Register. Id.
502(I) petitions are governed by 29 C.F.R. § 2570.85 and EBSA generally relies on established
guidelines as to what constitutes good faith by a fiduciary when a fiduciary has engaged in a prohibited
transaction. EBSA Survey Response, supra note 166, at 4. “All petitions must be in writing and contain
the petitioner’s name, a detailed description of the breach or violation, a recitation of the facts which
support the basis for waiver or reduction accompanied by supporting documentation, and a declaration
under penalty of perjury as to the veracity of the information of the petition.” Id. EBSA does not publish
copies of grants or denials of 502(I) petitions in the Federal Register. Id. at 5.

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(iii)

Findings Regarding Prosecutorial Discretion

Agencies were reticent to share too much information about their exercises of
prosecutorial discretion. This is not altogether surprising. An agency’s decision to not
enforce the law where violations have occurred can be sensitive. 208 Agencies may not
want regulated parties to know exactly where the line is; if an agency’s enforcement
priorities are cloaked in mystery, more entities will comply with the law. 209
The PHMSA, EBSA, MSHA, and CDFI did not respond to this section of the
survey, and the FTA said that it does not engage in prosecutorial discretion, because
“[t]o the extent possible violations are discovered, FTA requires grantees to take
corrective action.”210 The TTB simply gave a one-word answer when asked whether it
ever “choose[s] not to enforce the law against known violations”: “No.” 211
Some of the survey responses were lengthier. The FAA, in particular, explained
its approach to prosecutorial discretion in some detail:
[T]he FAA does not exempt persons who have violated FAA statutes or
regulations from the requirements of those provisions. Rather, when an
FAA inspection produces sufficient evidence to conclude that a regulated
person has violated a statute or regulation, the FAA takes action
appropriate to address the noncompliance. The types of actions the FAA
takes, and the bases for selecting such actions, are detailed in FAA Order
2150.3B, chap. 5, at 5-1 to 5-9, which guides FAA personnel in the exercise
of prosecutorial discretion (available online). Pursuant to this policy, the
FAA may take compliance action, administrative action, or legal
enforcement action.
The FAA generally uses compliance and administrative actions (which do
not result in remedial or punitive FAA enforcement) to ensure that
208 See, e.g., Shoba Sivaprasad Wadhia, My Great FOIA Adventure and Discoveries of Deferred Action

Cases at ICE, 27 GEO. IMMIGR. L.J. 345 (2013) (using Freedom of Information Act (“FOIA”) to try to
investigate prosecutorial discretion in the context of immigration).
See, e.g., Mayer Brown LLP v. IRS, 562 F.3d 1190, 1192-93 (D.C. Cir. 2009) (“[Freedom of
Information Act] Exemption 7(E) shields information if ‘disclosure could reasonably be expected to risk
circumvention of the law.’ If the FOIA request here sought a checklist used by agents to detect fraudulent
tax schemes or the words most likely to trigger increased surveillance during a wiretap, the applicability
of the exemption would be obvious.”) (quoting 5 U.S.C. § 552(b)(7)(E)).
209

210 FTA Survey Response, supra note 170.
211 TTB Survey Response, supra note 167.

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regulated persons return to full compliance and take measures to prevent
recurrence. It is appropriate for FAA personnel to take legal enforcement
action (for remedial or punitive proposes) against a regulated person for
noncompliances resulting from: intentional conduct, reckless conduct,
failure to complete corrective action, conduct creating or threatening to
create an unacceptable risk to safety, conduct where legal enforcement
action is required by law, repeated noncompliance, the provision of
inaccurate data to the FAA, actions pertaining to competency or
qualification, and law enforcement-related activities. Regardless of how a
noncompliance is addressed, the regulated person must return to
compliance, now and for the future, or legal enforcement action may be
taken.212
The FMCSA, after explaining its exemption procedure, also shared some
thoughts on prosecutorial discretion that bear quoting:
In addition, FMCSA conducted almost 8,000 investigations in FY2016.
Regulatory violations of varying severity are found in almost every
investigation. The investigations resulted in the issuance of approximately
4,400 Notices of Claim alleging one or more violations of the safety,
commercial, or hazardous materials regulations. As more fully described
below, FMCSA regularly discovers violations for which it chooses not to
take enforcement action. FMCSA’s overarching goal is safety, so before it
initiates an enforcement action, it considers whether that enforcement
action is the best method for achieving compliance. . . . Because it is likely
that regulatory violations were found in almost all of the investigations,
FMCSA’s decision to not issue Notices of Claim in the other 3,000+
investigations could be described as an exercise of prosecutorial
discretion. 213
Ultimately, prosecutorial discretion is an area of administrative law that still in
many respects is an empirical mystery. Exactly how agencies choose to exercise this
power, the process they use, how often they do so, and the internal checks they employ,
are all issues that merit additional study. Unfortunately, finding such answers will be
difficult because agencies are understandably hesitant to provide detailed information.
These extended remarks from the FAA and the FMCSA are greatly appreciated.
212 FAA Survey Response, supra note 158; see also DEP’T OF TRANSP., GUIDANCE FOR IMPLEMENTING THE

FAA COMPLIANCE PHILOSOPHY (2015),
2150.3B_Chg_9.pdf (last visited Oct. 31, 2017).

https://www.faa.gov/documentLibrary/media/Order/

213 FMCSA Survey Response, supra note 169.

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(iv)

Catchall Findings

One of the questions posed to the agencies addressed the role those outside the
agency play in nonenforcement decisions.
As explained in Part II, whether
nonenforcement is driven by “political” or “technocratic” concerns may be relevant to
one’s view of its propriety (recognizing, of course, that there is rarely a bright line
separating the two). Presumably if officials outside of the agency participate in
nonenforcement decisions, the potential for “political” influence increases. Here, each
of the agencies that participated in the survey and that answered this question
specifically stated that those outside of the agency did not participate in
nonenforcement decisions—at least not “generally.”214 Of course, this point does not
necessarily extend to all agencies. Even so, it is noteworthy that at least in this crosssection of agencies, involvement by agency outsiders is not a regular occurrence.
Finally, most agencies, understandably, did not share their views of the D.C.
Circuit’s analysis in NetworkIP. (Candidly, the author did not expect many responses,
especially because so many agencies litigate before the D.C. Circuit.) Hence, most of the
participating agencies ignored this question or said they had no opinion. Similarly, one
simply said it agreed with the analysis with little explanation,215 while another largely
said the same.216 None of this is surprising. Two agencies, however, did share some
interesting views which merit being quoted in full because they are thoughtful and
address the inherent tensions at issue.
The FMCSA addressed NetworkIP at some length, and agreed that a public
interest standard may be susceptible to abuse. Specifically, the agency explained that:
FMCSA generally agrees with the court’s view in NetworkIP, LLC v. FCC,
548 F.3d 116 (D.C. Cir. 2008). Criteria that set forth the special
214 FAA Survey Response, supra note 158; see also FMCSA Survey Response, supra note 169 (“In some
instances, the agency may consult with other federal entities if their interests warrant consideration,
such as aircraft operations over national parks.”); EBSA Survey Response, supra note 166 (“With EBSA’s
decisions to grant statutory waivers, administrative exemptions that are processed on a class rather than
individual basis are processed much like regulatory initiatives and will undergo a Departmental
Clearance process prior to submission to the Office of Management and Budget.”).
215 TTB Survey Response, supra note 167.

See CDFI Survey Response (on file with author) (agreeing that “grants of waivers should be
determined in a fair and equitable manner”); TTB Survey Response, supra note 167 (“Yes. Because TTB’s
waiver decisions are frequently fact-specific and generally subject to disclosure restrictions, criteria used
to evaluate waiver requests should be clear and applied consistently to regulated parties.”).
216

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circumstances where waiver of or exemption from a rule is appropriate
increase the likelihood of consistent and predictable outcomes.
Nonetheless, the purpose of waivers and exemptions is to give an agency
the flexibility to reach an equitable result in a particular situation. It is not
feasible or efficient for an agency to contemplate the multitude of
circumstances that would warrant waivers and exemptions across the
broad spectrum of rules it administers. While more specific waiver and
exemption criteria may be feasible in limited circumstances, such as in the
case of the filing deadline considered by the court in NetworkIP, in many
instances the decision regarding whether to grant a waiver or exemption
is more appropriately based on the totality of the circumstances,
particularly when significant policy considerations are present. As long as
an agency adequately articulates the special circumstances that warrant
deviation from the rule at issue, future parties are on notice as to how the
agency will interpret its rule and judicial review is not frustrated.
Moreover, such a view is consistent with the court’s position in NetworkIP
that an agency is afforded deference regarding its decision whether to
waive one of its own rules.
As specifically concerns FMCSA’s waiver and exemption authority and
regulatory standards for exercising that authority, we would note
incidentally that the Agency’s exercise of discretion is defined by the
requirement that relief from regulatory obligations in such circumstances
would likely achieve a level of safety equivalent to or greater than the
level that would be achieved absent the involved waiver or exemption.
Accordingly, FMCSA’s waiver and exemption statutory framework and
regulatory structure is constrained by a safety-related standard that is
inherently more stringent than “whatever is consistent with the public
interest” as referenced by the D.C. Circuit’s NetworkIP ruling.217
The EBSA also addressed this question—and identified the downside of overly
“rigid” requirements.
Greater clarity on the criteria used to make waiver determinations will
instill the public’s trust that its government institutions are not making
decisions in an arbitrary manner. However, agencies need flexibility in
applying criteria used to grant waivers in order to avoid treating all
applications the same. Exemption applications submitted to EBSA are
very fact-specific, and a decision whether or not to grant an exemption
217 FMCSA Survey Response, supra note 169.

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may turn on one small detail. A more rigid set of criteria that focuses less
on the individual facts of an application may either cause EBSA to grant
exemptions that it would not currently grant, or to deny applications
otherwise deserving of exemptive relief. 218
C.

Case Studies

In addition to the general findings discussed above, this study produced several
case studies about how particular agencies—specifically, the CFPB, FAA, MSHA, and
TTB—go about their business. These studies are based on agency responses to the
survey, the author’s interview with agency officials, and other background research.
Note that although this analysis goes into some detail, the Report does not claim to have
a comprehensive take on these agencies. Agencies are large and complex. There is no
guarantee that the agency officials interviewed have perfect information, and, even if
they did, inevitably some nuance is lost in the communication process. Likewise,
agency practices evolve; what was true when the surveys were completed may not
remain true at later dates. Despite these limitations, however, a close analysis of the
behavior of specific agencies is still useful.
(i)

The CFPB

The first case study addresses the CFPB, a relatively new agency that, generally,
has not engaged in nonenforcement, at least through a formal program. The CFPB was
created in 2010 by the Dodd-Frank Wall Street Reform and Consumer Protection Act
and is tasked with protecting American consumers who are in the market for consumer
focused financial products and services.219 It has robust regulatory powers, including
authority to engage in rulemaking and to bring enforcement actions.
When it comes to the subject of this Report, the CFPB is interesting because,
although several of the laws administered by the Bureau grant authority akin to what
this Report refers to as “waivers,”220 the Bureau does not engage in much
nonenforcement, at least prospectively on an individualized basis, although it may do
so through notice-and-comment rulemaking for a category of parties.
When
implementing the statute through rulemaking, the CFPB may identify requirements that
218 EBSA Survey Response, supra note 166.

Creating
the
Consumer
Bureau,
https://www.consumerfinance.gov/about-us/thebureau/creatingthebureau/ (last visited Oct. 31, 2017).
219

220 See, e.g., 12 U.S.C. § 5532; id. § 1831t; 15 U.S.C. § 1639; id. § 1691c-2.

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Waivers, Exemptions, and Prosecutorial Discretion:
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do not make sense as applied to certain types of circumstances, and thus, modify them.
To the extent that this sort of decision is a form of nonenforcement, the agency routinely
goes through the ordinary notice-and-comment process to do it.
Perhaps more interesting, the agency also has authority to not enforce the law for
individual entities (by order) but it has only exercised this formal authority once.
Consider the agency’s Trial Disclosure Program, which is described in some
detail in the Federal Register.221 In short, this program allows regulated parties to
propose a new form of disclosure that conflicts with the agency’s regulations. Congress
explicitly gave the agency this power. 222 The idea is that perhaps a regulated party can
produce a better disclosure than what the regulations currently require. In designing
the program, the CFPB solicited public comments and responded to them. An applicant
must submit a proposal that “[d]escribes how these changes are expected to improve
upon existing disclosures, particularly with respect to consumer use, consumer
understanding, and/or cost-effectiveness,” and “[p]rovide a reasonable basis for
expecting these improvements, and metrics for testing whether such improvements are
realized.”223 Thereafter, the Bureau evaluates the proposal according to a nonexhaustive set of factors, including “[t]he extent to which the program anticipates,
controls for, and mitigates risks to consumers.”224 If the proposal is accepted, the
agency will publicize that fact.225 Despite being on the books for almost four years,
however, the Trial Disclosure Program to date has not resulted in a single approved
proposal. Nor does it appear that the agency has denied any requests.
221 See Policy To Encourage Trial Disclosure Programs; Information Collection, 78 Fed. Reg. 64,389

(Oct. 29, 2013).
222 See 12 U.S.C. § 5532(e) (stating that the agency, through a public process, “may permit a covered
person to conduct a trial program that is limited in time and scope, subject to specified standards and
procedures, for the purpose of providing trial disclosures to consumers[,]” and that such a person “shall
be deemed to be in compliance with, or may be exempted from, a requirement of a rule or an enumerated
consumer law”).
223 Policy To Encourage Trial Disclosure Programs; Information Collection, 78 Fed. Reg. at 64,393.
224 Id.
225 See id. (“The Bureau will publish notice on its Web site of any trial disclosure program that it

approves for a waiver. The notice will: (i) Identify the company or companies conducting the trial
disclosure program; (ii) summarize the changed disclosures to be used, their intended purpose, and the
duration of their intended use; (iii) summarize the scope of the waiver and the Bureau's reasons for
granting it; and (iv) state that the waiver only applies to the testing company or companies in accordance
with the approved terms of use.”).

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It is hard to say for certain why the program has not been used more. It could be
because the current regulations are so well understood and institutionalized that
regulated parties are reluctant to spend the resources necessary to prepare a proposal.
It also is possible that regulated parties would like to see someone else do one first to
see how the well the program works. Similarly, regulated parties may be wary of a
public process. It is unlikely, however, that the lack of proposals is due to ignorance;
indeed, the program is featured prominently on the agency’s webpage. 226
A similar story could be told about the Bureau’s “no action” letters. If the agency
gives one of these letters, it means that agency staff has no intention of recommending
initiation of an enforcement or supervisory action. Although non-binding, such a letter
should be valuable to a regulated party. The Bureau, moreover, has established a
program for granting such letters, again after soliciting comments from the public about
how the program should work.227 Agency staff is authorized to issue such letters
“involving innovative financial products or services that promise substantial consumer
benefit where there is substantial uncertainty whether or how specific provisions of
statutes implemented or regulations issued by the Bureau would be applied . . . .” 228
These letters, moreover, “may be conditioned on particular undertakings by the
applicant with respect to product or service usage and data-sharing with the Bureau. ”229
Such letters “generally would be publicly disclosed.”230 Yet the program has only been
used once—in September 2017.231
226 Trial Disclosure Program https://www.consumerfinance.gov/about-us/project-catalyst/trialdisclosure-program/ (last visited Oct. 31, 2017).

Policy
on
No-Action
Letters;
information
collection
1
(2016),
http://files.consumerfinance.gov/f/201602_cfpb_no-action-letter-policy.pdf (last visited Oct. 31, 2017).
This policy was also published in the Federal Register. See 81 Fed. Reg. 8686 (Feb. 22, 2016).
227

228 Id. at 1–2.
229 Id. at 2.
230 Id.

See, e.g., CFPB Announces First No-Action Letter to Upstart Network (Sept. 14, 2017),
https://www.consumerfinance.gov/about-us/newsroom/cfpb-announces-first-no-action-letter-upstartnetwork/ (“The Consumer Financial Protection Bureau (CFPB) today announced a no-action letter issued
to Upstart Network, Inc., a company that uses alternative data in making credit and pricing decisions. As
a condition of the no-action letter, Upstart will regularly report lending and compliance information to
the CFPB to mitigate risk to consumers and aid the Bureau’s understanding of the real-world impact of
alternative data on lending decision-making. This action comes as the Bureau continues to explore the
use of alternative data to help make credit more accessible and affordable for consumers who are credit
invisible or lack sufficient credit history.”) (last visited Oct. 31, 2017).
231

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Waivers, Exemptions, and Prosecutorial Discretion:
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The Bureau also has systems in place to guide prosecutorial discretion. When it
comes to supervising financial institutions (of which the nation has many), discretion is
used to determine who is higher risk and needs to be supervised more closely versus an
entity that is lower risk and does not need the same level of supervision. The CFPB
uses an examination manual (which is publicly available) to help direct this process. 232
There also can be some discretion in the CFPB’s public enforcement processes. Given
the breadth of the agency’s mission and the number of entities under its jurisdiction,
there inevitably will be some prosecutorial discretion.
After speaking with CFPB officials, one gets the sense that the agency hopes to
use nonenforcement to encourage more efficient use of regulatory power. Presumably
that is the reason why Congress gave the agency authority to encourage
experimentation regarding disclosures.233 The efforts the agency has undertaken to date
to create the Trial Disclosure Program or a way to provide no action letters suggests
that the agency recognizes that sometimes generalized requirements are a poor fit for
individual entities. The fact that regulated parties have not availed themselves of these
opportunities is noteworthy and merits further study.
(ii)

The FAA

The second case study addresses the FAA, one of the nation’s most established
agencies. This is true as a matter of history (the agency was created in 1958), size (the
agency has over 14,000 employees)234 and, for purposes here, nonenforcement. Indeed,
the FAA engages in vast amounts of nonenforcement, and, importantly, has a highly
regularized process to do so.
As explained above, the FAA identified eight sources of waiver authority; it also
“has a robust practice in considering regulatory exemptions in general, as well as

232 See CFPB Supervision and Examination Manual (Aug. 2017), https://s3.amazonaws.com/files.

consumerfinance.gov/f/documents/201708_cfpb_supervision-and-examination-manual.pdf (last visited
Oct. 31, 2017).
233 Regulatory experimentation is currently the focus on a separate study.
See Regulatory
Experimentation, https://www.acus.gov/research-projects/regulatory-experimentation (last visited Oct.
31, 2017).
234A Brief History of the FAA, https://www.faa.gov/about/history/brief_history/ (last visited Oct.

31, 2017); Air Traffic by the Numbers, https://www.faa.gov/air_traffic/by_the_numbers/ (last visited
Oct. 31, 2017).

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Waivers, Exemptions, and Prosecutorial Discretion:
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specific waiver programs that may be built into those regulations.” 235 And although the
agency has only recently begun tracking the number of waivers granted, its exemption
practice is vigorous; indeed, it has received over 16,000 requests for nonenforcement
regarding drones since August 2016 alone.236 Even apart from drones, it “receives
approximately 400-500 requests for exemptions per year.”237 No doubt driven by this
volume, the agency has developed a standardized approach to nonenforcement. 238
The process begins with a formal request which is submitted to a public docket
on Regulations.gov. The FAA’s Office of Rulemaking then handles the logistics of
responding to the request. “They are assigned for review and disposition to the
program office . . . that covers the particular regulations from which relief is
requested.”239 Importantly, “[m]ost requests are reviewed by an attorney in the
Regulations Division of the FAA’s Office of the Chief Counsel.” 240 Afterwards, the
agency gives its answer, whether “grant or denial,” on the public docket. The agency
also allows for reconsideration, and “[s]uch requests are ultimately reviewed by the
Administrator to be considered final agency action.”241 Importantly, the public can
comment on requests for nonenforcement, and the agency “regularly publishes a
summary of requests for exemption in the Federal Register for requests that are novel,
significant, or are of first impression to alert the public to such requests.” 242
The agency also has a guide for “FAA personnel in the exercise of prosecutorial
discretion,” and the agency “may take compliance action, administrative action, or legal
enforcement action.”243 The agency, unsurprisingly, is more likely to pursue punitive

235 FAA Survey Response, supra note 158.
236 See id.
237 Id. (emphasis omitted).
238 Id.
239 Id.
240 FAA Survey Response, supra note 158.
241 Id. (citing 14 C.F.R. § 11.101).
242 Id.
243 Id.; see also DEP’T OF TRANSP., GUIDANCE FOR IMPLEMENTING THE FAA COMPLIANCE PHILOSOPHY

(2015), https://www.faa.gov/documentLibrary/media/Order/2150.3B_Chg_9.pdf (last visited Oct. 31,
2017).

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Waivers, Exemptions, and Prosecutorial Discretion:
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action against more serious violations.244 But the FAA reports that it “does not exempt
persons who have violated FAA statutes or regulations from the requirements of those
provisions.”245 Instead, if the agency determines that punitive measures are not
necessary, it “generally uses compliance and administrative actions (which do not result
in remedial or punitive FAA enforcement) to ensure that regulated persons return to
full compliance and take measures to prevent recurrence.”246
During the interview, agency officials gave further details about this process.
The agency stressed that safety is paramount. Hence, although regulated parties
sometimes try to argue that compliance with a regulation is too costly, such an
argument is unlikely to succeed. By contrast, the most typical successful petitions for
nonenforcement are those where the regulated party shows that there will be no
adverse harm to safety. Similarly, the agency generally gives exemptions on a planeby-plane basis, but if an exemption is requested for something that is affecting an entire
fleet of planes, a fleet-wide exemption is possible. Likewise, the FAA stressed that it
tries to be accessible to the public. For example, it will fix an exemption request if the
regulated party cites to the wrong authority.
It is noteworthy, moreover, that if a request for exemption is denied, it is quite
unlikely that the petitioner will seek judicial review. Indeed, it is almost unheard of;
those interviewed could only remember a single instance of a disappointed party going
to court, and that suit was dropped once it was clear that the agency would not settle. It
also appears to be the case that although the largest players in the industry are most
aware of the agency’s nonenforcement process, even smaller regulated companies often
know a great deal about it. Seeking exemptions tends to be most challenging for
individuals (i.e., passengers). For example, if a disabled child needs to use a different
type of restraint system, special permission must be sought from the FAA. Often the
airline will handle the process for its passengers.

244 Id. (“It is appropriate for FAA personnel to take legal enforcement action (for remedial or punitive

purposes) against a regulated person for noncompliances resulting from: intentional conduct, reckless
conduct, failure to complete corrective action, conduct creating or threatening to create an unacceptable
risk to safety, conduct where legal enforcement action is required by law, repeated noncompliance, the
provision of inaccurate data to the FAA, actions pertaining to competency or qualification, and law
enforcement-related activities.”).
245 FAA Survey Response, supra note 158.
246 Id.

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Waivers, Exemptions, and Prosecutorial Discretion:
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The impression one takes away from the FAA is that they have regularized the
process. The agency attempts to put almost everything in the open and has
standardized its channels for resolving nonenforcement requests. The agency does not
place summaries of all decisions in the Federal Register, but it tries to do so for the ones
that break new ground.247 It also is open to receiving comments from the public.
(iii)

The MSHA

The third case study addresses the MSHA, an important agency within the
Department of Labor. Congress created the MSHA in 1977 and tasked it with
overseeing the health and safety of those working in the mining industry. 248 The MSHA
does not address nearly as many requests for nonenforcement as the FAA, but it
nonetheless addresses a fair number of such requests. Similar to the FAA, the agency’s
analysis is driven by safety.
The MSHA has set procedures for modifying future enforcement of a particular
standard (often adding replacement requirements at the same time), which requests the
agency dubs “petitions for modification.” Indeed, the agency has an entire handbook,
publicly accessible, that details how the agency processes such requests. 249 A mine
must formally request a modification, at which point the agency posts the request in the
Federal Register.250 Interested parties thereafter can file comments. Ordinarily, not
many comments are filed, but the officials observed that union representatives
frequently file comments. The agency then conducts a field investigation to examine
the facts on the ground. Higher level officials thereafter examine the request, any
comments, and the field report to make a decision called a Proposed Decision and
Order. That decision can be appealed to an administrative law judge, whose decision in
turn can be appealed to the agency’s assistant secretary.251 Following that, it is possible
to seek review in district court, but that is rare.

247 Of course, what is “novel” may be in the eye of the beholder.

That said, the agency emphasized

that it tries to be transparent in its nonenforcement decisions.
248 History, https://www.msha.gov/about/history (last visited Oct. 31, 2017).
249 See PETITIONS FOR MODIFICATION, COAL MINE SAFETY AND HEALTH AND METAL AND NONMETAL

MINE SAFETY AND HEALTH, MSHA HANDBOOK SERIES, https://arlweb.msha.gov/READROOM/
HANDBOOK/PH08-I-2.pdf (July 2008) (last visited Oct. 31, 2017).
250 The agency also “organizes them by year on its website.” MSHA Survey Response, supra note 171.
251 See 30 C.F.R. § 44.35 (2017).

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Waivers, Exemptions, and Prosecutorial Discretion:
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By statute, mines must raise one of two arguments in support of a modification
to a safety standard.252 First, that the mine will engage in another practice that is at least
as safe as what the regulation hopes to achieve. Or second, that if the regulation is
followed as written, it will result in a diminution of safety, at least for the specific
location. The MSHA will not grant a modification if the result would be a less safe
working environment for miners. For example, MSHA regulations require that coal
mines maintain a “300 feet” diameter around oil and gas wells. 253 (Coal mining could
cause sparks, which would be very dangerous around an active or inactive gas or oil
well.) If a mine wants to move closer to the well, it can request a modification. The
MSHA will then consider granting such a modification if the mine can show that the
proposal is as safe as the standard.254 Outside of coal, a typical situation involves use of
pressurized air to dust off miners. Ordinarily, that is not permitted, but when an
outside company constructed a safe machine to do it, the agency began readily
authorizing such modifications.255
The process, on average, takes approximately nine months, although there are
means for expedited consideration.256 Agency officials stressed that once granted, the
permission is generally permanent.
As noted above, many requests, but not all, are granted. And, indeed, it is not
especially difficult to make a request. Because the agency recognizes that mining
conditions and technology change, it is willing to work with mines to find practical
solutions. At the same time, the agency stressed that safety is paramount.
According to the agency’s numbers, it received 64 petitions for modification in
2014, and granted 23 of them “at least to some extent.”257 To be clear, however, that
does not mean that all of the other petitions were denied. Sometimes they are
withdrawn because the mine can find another way to accomplish its goal. Similarly,
MSHA officials during the interview made an interesting observation. They explained
252 See 30 U.S.C. § 811(c).
253 30 C.F.R. § 75.1700.
254 See 30 C.F.R. § 44.16(e).
255 See, e.g., Annapolis Mine, 81 Fed. Reg. 8996 (Mine Safety & Health Admin. Feb. 23, 2016) (final

admin. review).
256 See 30 C.F.R. § 34.16.
257 MSHA Survey Response, supra note 171.

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Waivers, Exemptions, and Prosecutorial Discretion:
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that one reason that there are fewer requests for modifications of standards is that the
mining industry is an established one; technological changes occur sometimes, but often
not especially quickly. Thus, mines generally do not need regulatory modifications.
Likewise, the agency’s substantive standards themselves are often performance based
(i.e., they are based on outcomes, not necessarily specific means), so it is fairly feasible
and reasonable for mines to comply with them.
This agency stressed that it does not engage in prosecutorial discretion—
inspectors must cite a violation if they see one. That said, the agency recognizes that
infeasibility can be a defense and may delay enforcement in narrow instances to allow
an industry or an operator to come into compliance. For instance, soon after a new
standard is promulgated, the agency may not require immediate implementation so
long as the regulated mine is making a good faith effort to comply. This sort of analysis
is generally mine-specific. Sometimes, moreover, the agency uses infeasibility in a
categorical way. One example involved self-contained self-rescuers (SCSRs), which are
devices that provide breathable air to miners during emergencies. During the
interview, it was recounted that once the agency required a certain type of SCSRs for
coal miners, but that the SCSRs, although ordered, were not arriving in time for mines
to comply with the new standard. The agency accordingly informed mines across the
board that they would not be cited as long as they could show that they had ordered the
required SCSRs.
The MSHA’s approach shares many of the characteristics as the FAA’s. It also
uses a public process and evaluates modifications to standards based on safety. Unlike
the FAA, however, this agency engages in much less nonenforcement or modification
activity, at least judged by the number of requests. The thoughtful explanations given
by the agency for the relatively small number of requests certainly has a ring of truth to
it, and may have wider applicability than just the MSHA context.258
(iv)

The TTB

Finally, the fourth case study is the TTB. The TTB is an interesting agency; it
operates both as a taxing agency and as a consumer protection agency. Housed within
Another possibility is that, because decisions granting modifications are published, some
regulated parties may be aware of the agency’s willingness (or lack thereof) to grant particular types of
modifications and under what conditions. Or perhaps smaller operations have less need for a
modification or less ability to satisfy the requirements for one.
258

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the Treasury Department, it is tasked with “enforcing the provisions of the Federal
Alcohol Administration Act . . . to ensure that only qualified persons engage in the
alcohol beverage industry” by regulating alcohol and tobacco production, with a focus
on taxation but also on product labeling. 259 The TTB boasts 470 employees across the
country.260
In some respects, the TTB is closer to the MSHA than it is to the FAA. Like the
MSHA, the amount of nonenforcement is fairly limited; whereas the FAA may consider
hundreds or even thousands of requests for waivers or exemptions in a single year, the
TTB will often receive less than fifty. In other respects, however, the TTB is similar to
both the FAA and the MSHA. Most obviously, the agency requires an application
before it engages in nonenforcement and the agency does not grant all requests. It
denies approximately 15% of them.
In other ways, however, the TTB is different from both the FAA and the MSHA.
Whereas both the MSHA and the FAA make nonenforcement decisions public, the TTB
typically does not place information about its nonenforcement decisions in the Federal
Register or otherwise make them available. 261 The primary reason for this, according to
the agency, is that confidentiality is especially important when it comes to taxes. Thus,
the agency is reluctant to share too much information. That said, the agency
emphasized that if there is an issue of widespread applicability, the agency is willing to

259 TTB’s Mission–What We Do, https://ttb.gov/consumer/responsibilities.shtml (last visited Oct. 31,

2017); see, e.g., TTB Ruling 2016-2 (Sept. 29, 2016) (“As part of its ongoing efforts to reduce for industry
members the regulatory burdens associated with formula approval and to increase administrative
efficiencies for the Bureau, consistent with its mission to protect the public and collect the revenue, TTB
has reviewed the formula requirements for certain agricultural wines to determine where its formula
review process could be streamlined and modernized. As a result of this review, TTB has determined that
its formula review process for certain standard agricultural wine products can be accomplished in a more
efficient manner while still being consistent with TTB’s mission.”); TTB, Industry Circular, No. 2004-3
(Aug. 31, 2004) (“We are issuing this circular to announce an alternative procedure to allow you to
request approval to retain export documentation at your premises.”).
See TTB’s Mission–What We Do, https://ttb.gov/consumer/responsibilities.shtml (last visited
Oct. 31, 2017).
260

261 TTB Survey Response, supra note 167.

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issue guidance documents to the regulated community. 262 But the process under the
TTB is different because, as a rule, it is not public.
The TTB uses what it calls “Alternate Methods or Procedure.” 263 Through these
the agency allows regulated parties to use other methods to achieve legal compliance.
This device is used for prospective nonenforcement. By contrast, the agency typically
pursues known violations, thus exercising prosecutorial discretion somewhat rarely.
Typically, this occurs at the investigator-level. (Judicial review of any aspect of the
agency’s nonenforcement is very unusual.)
In the TTB’s experience, more often it is the larger manufacturers that seek
prospective nonenforcement. One potential explanation for this is that smaller players
do not need exceptions as often as larger ones. Lack of knowledge certainly is possible,
but given the amount of contact between the agency and those it regulates (e.g., licenses
and inspections), this explanation may be less likely.
Finally, TTB offered wise counsel regarding how to think about nonenforcement.
The agency considers the motivation behind the rule and judges the request against that
motivation. The agency also explained that sometimes the better course is simply to
amend the regulation itself, especially if it becomes clear that the regulation is no longer
accomplishing the objective for which it was created.
IV. RECOMMENDED BEST PRACTICES
Nonenforcement, for all the reasons explained thus far, is an important tool for
agencies, but one that carries with it risks. The degree of danger depends on the type of
nonenforcement at issue and the checks that exist to prevent abuse. Accordingly, it is
difficult to make any bright-line rules about how nonenforcement should be
implemented in specific cases or even specific types of cases. Sometimes the world is
too complicated for across-the-board answers. That said, it is possible to at least
identify considerations that should inform nonenforcement, even if those considerations
do not always lead to the same prescriptions in all circumstances. The purpose of this

262 See, e.g., TTB Industry Circular 2017-3 (May 19, 2017).

For more information on agency uses of
guidance, see Agency Guidance, https://www.acus.gov/research-projects/agency-guidance (last visited
Oct. 31, 2017).
263 See, e.g., 27 C.F.R. §§ 19.26, 19.27.

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section is to recommend best practices that agencies should consider when evaluating
their nonenforcement practices.
To be clear, the primary focus of these recommendations concerns agency
decisions to not bring enforcement actions. Because nonenforcement is such a broad
concept, it seemed prudent to limit the scope of the recommendations. Even so, these
recommendations may also be relevant to other forms of nonenforcement. For instance,
just as regularized and public procedures are useful when an agency decides whether to
bring an enforcement action, such procedures are also useful when an agency decides
whether to excuse a procedural failing in an administrative adjudication. Of course,
there are limits to this comparison; it may be less realistic to open up a decision whether
to waive a procedural failing to full public notice and comment. But principles
developed in one context can still have some force in other contexts.
Accordingly, based on interviews with agency officials, a review of the
nonenforcement literature, and background insights into administrative law more
generally, the Report urges that the following best practices merit agency consideration.
A.

If Possible, Save Nonenforcement for “Special” Cases

When reasonably possible, nonenforcement should be saved for “special” cases.
This is so because if an agency too readily resorts to nonenforcement, the exception may
become the rule, resulting in a world in which the law on the books does not reflect the
law on the ground. This should be avoided. In such a world, “insiders” may have an
unfair advantage and the public may lose confidence in the fairness of the system. To
be sure, discretion is important because it is impossible to identify up front every
possible scenario that might arise.264 Indeed, the impossibility of anticipating when
application of a rule may be unjust or imprudent is one of the drivers behind
nonenforcement.265 Yet the more unbridled the discretion, the greater risk of bias, or at
least the perception of bias.266 Agencies need to strike a balance.

264 See, e.g., Clayton P. Gillette & James E. Krier, Risk, Courts, and Agencies, 138 U. PA. L. REV. 1027,

1064 n.98 (1990).
265 Id.
266 See, e.g., Clifford Rechtschaffen, Promoting Pragmatic Risk Regulation: Is Enforcement Discretion the

Answer?, 52 U. KAN. L. REV. 1327, 1354 (2004) (“As the discretion afforded to regulators increases, so does
the potential for biased or inconsistent enforcement. There is considerable evidence showing that
enforcement personnel exhibit systematic biases when they make discretionary decisions.”).

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The D.C. Circuit’s analysis in NetworkIP is instructive (although, to be sure, it
arose in the context of an agency’s decision to waive a procedural rule and not in the
context of an agency’s refusal to bring an enforcement action). The court explained that
an agency must be able to “articulate the nature of the special circumstances to prevent
discriminatory application and to put future parties on notice as to its operation.” 267
The reason the D.C. Circuit did this was because it wanted to prevent nonenforcement
from becoming too common, thus turning the exception into the (sometimes unwritten)
rule. The interviews revealed that these agencies are aware of this danger. This is one
reason, for instance, that the agencies require a strict showing that nonenforcement will
not undermine the purposes of the relevant prohibition. Both the MSHA and the FAA
stressed that safety is key and the burden is on the applicant to show that there will be
no loss of safety. This point was echoed repeatedly.
Related to the idea that nonenforcement should be the exception rather than the
rule is the notion that nonenforcement should also have objective criteria and a clear
temporal dimension. Again, the D.C. Circuit’s approach bears consideration. The
agency needs to explain why it is objectively reasonable to grant a waiver; if the agency
cannot do so, there is a danger that it is behaving in an arbitrary manner. Similarly,
nonenforcement may be more appropriate if its duration is shorter, although this is not
always the case. As the FAA explained, “most of our exemptions are granted only for
the length of time needed, and generally not more than two years. Exemptions expire
by their own terms unless renewal is requested and justified.” 268 The common
denominator is that nonenforcement should be recognized as a significant power that is
to be used sparingly and carefully.
B.

Greater Use of Retrospective Review

Agencies, to the extent permitted by law, should also focus on amending
outdated or ineffective prohibitions, which may be helpfully identified by the agency’s
willingness to grant requests for nonenforcement. Agencies, for example, often fall
back on nonenforcement because the regulation in question no longer makes sense,
sometimes in individual circumstances but often across the board. Rather than engage

267 NetworkIP, LLC v. FCC, 548 F.3d 116, 127 (D.C. Cir. 2008).
268 FAA Survey Response, supra note 158.

Of course, a deadline may not always make sense, for
instance in situations in which an exemption requires a substantial capital investment or operational
change that should have some permanence. In such situations, a longer period may be appropriate.

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in nonenforcement in such circumstances, if possible, the better path may be to change
the underlying prohibition.
This point came up during several of the interviews. The MSHA, for instance,
explained that it has done this before. And the CFPB reasoned that using notice-andcomment rulemaking often makes sense; it can be both more efficient (because it applies
across the board) and more transparent. The TTB also recognizes that nonenforcement
should be not treated as a substitute for updating the rules.
In the past, ACUS has urged retrospective review of regulations to ensure that
rules that are no longer serving their purpose, or are doing so in a suboptimal way, are
eliminated.269 One of the insights of this Report is that retrospective review may not
always be conceptually distinct from nonenforcement. Rather, multiple granted
requests for nonenforcement can be a signal that it may be time to engage in
retrospective review.
To be clear, there are costs associated with revising regulations. Generally, an
agency will have to engage in notice-and-comment rulemaking to do so, which will
require dedicated work by agency officials. No doubt, for some regulatory schemes,
revision would be quite labor intensive. But particularly if an agency already opens up
its nonenforcement decisions to the public, and has been doing so for a long time,
formally amending the rules may not be especially onerous.
C.

Publicize Nonenforcement Programs, Policies, and Procedures

The next recommendation is for agencies to inform the public regarding their
nonenforcement programs and policies, and the procedures for each. One of the
potential problems with nonenforcement is the risk of unequal treatment and
arbitrariness. To the extent that not everyone has equal access to information about
when and how agencies opt for nonenforcement, the risk of inequality or perceived
inequality increases—especially when the agency in question will not engage in
nonenforcement, either de jure or de facto, without a request. If that is the case (and it
often is), agencies should ensure that everyone has equal access to the required
information to make such a request.

269 See generally
Retrospective Review of Agency Rules, https://www.acus.gov/researchprojects/retrospective-review-agency-rules (last visited Oct. 31, 2017).

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Transparency is valuable. And the costs of transparency are less now than they
have been in the past.270 Agencies, for instance, have access to the internet. If agencies
have programs, policies, and procedures in place to guide nonenforcement, it should be
relatively straightforward for agency officials to make information about those
programs, policies, and procedures available to the public.
Granted, there may be downsides to publicizing an agency’s programs, policies,
and procedures. For instance, if information about nonenforcement becomes more
generally known, there may be more requests for nonenforcement. This may require
more time and effort be shifted towards evaluating nonenforcement. Yet that may be a
virtue. If agencies are going to engage in nonenforcement, the public presumptively
should have access to that information.
More serious, disclosure may encourage illegality. If regulated parties do not
know the contours of an agency’s nonenforcement policy, there will be more law
observance because such parties will not know the tripwires, thus causing them to be
more cautious altogether.271 But if there is no transparency, and no judicial review, how
can the public be confident that agencies are properly using their nonenforcement
authority? Although admittedly not a perfect answer, the most optimal approach is to
disclose nonenforcement policies, practices, and procedures, unless doing so would
have a significant effect on legal compliance.
The agency officials interviewed for this Report almost uniformly stated that
transparency is important. The CFPB, for instance, used a public comment process for
its two nonenforcement programs. Agencies that regulate entities of varying degrees of
legal sophistication might also consider actively informing some of the smaller entities
about nonenforcement options. And agencies that regulate a large number of entities
should consider actively trying to inform the public about nonenforcement, perhaps by
preparing simplified introductory materials that can be found via internet search
engines. Agencies that regulate a smaller number of entities may want to distribute
information through personal contacts.

See generally Adjudication Materials on Agency Websites, https://www.acus.gov/
recommendation/adjudication-materials-agency-websites-0 (last visited Oct. 31, 2017).
270

271 As explained above, there may be good reasons not to publicly disclose an agency’s approach.

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D.

Publicize Nonenforcement Decisions and Encourage Comments

Just as agencies can publicize their nonenforcement programs, policies, and
procedures, they also can publicize their decisions whether to grant or deny requests for
nonenforcement, including potentially doing so before making a final decision so that
interested parties can submit comments. The EBSA is a good example. In response to
the survey, the agency offered a recommended best practice that included the
following:
Applicants must disclose, under penalty of perjury, all relevant factual
information that may be used by EBSA to make its findings whether to
grant an exemption. EBSA will only grant an exemption based on a fully
developed record that is open to the public. Before granting an
exemption, EBSA must publish a proposed exemption on the Federal
Register and give interested persons the ability to comment and request a
hearing. Only after considering commenters’ input may EBSA then grant
an exemption.272
Some agencies may be reluctant to do this because they are wary of sharing
sensitive information about an application with outsiders. The TTB, for instance,
expressed this concern; when dealing with tax information, it may not be possible to
present all of the relevant materials to the public. Even if the agency does not wish to
disclose individual nonenforcement decisions, however, it can present general statistics
and trends. If a large number of entities are receiving a similar exemption, the agency
may consider sharing that information with the public, even if it does not provide
individualized information. Similarly, agencies in such situations may consider
redacting confidential information. (To the extent that agencies worry about costs or
resources, it is worth noting that this information can be disclosed in any number of
ways and need not appear in a Federal Register notice.)
A good analogy is the judicial process. Courts generally make their decisions
public because they recognize the public interest in transparency. 273 Even though most
cases are not important to the public in general (sometimes no one but the parties
involved care about a specific contract dispute or the like), the judiciary still recognizes
272 EBSA Survey Response, supra note 166.
273 See, e.g., Researching Judicial Decisions, https://www.loc.gov/law/help/judicial-decisions.php
(explaining how cases are published) (last visited Oct. 31, 2017).

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the importance of disclosure. And, in any event, courts do not want to be in the
business of deciding whether a particular case is important or not, especially because it
can be difficult to know what may become important.
Agencies could adopt the same attitude. Of course, there are downsides with
this recommendation as well. For one thing, publicizing this information may result in
increased scrutiny of agency decisions—which may include unfair characterizations of
agency behavior. The public may not understand all of the factors that go into a
nonenforcement decision. To avoid being misunderstood, agency officials may find
themselves spending more time giving reasons for their decisions. Yet at the same time,
doing so may increase the public’s confidence in the agency decision.
Similarly, agencies should, to the extent possible, encourage affected entities to
comment about the desirability and appropriateness of nonenforcement. Particularly
where other entities may be affected, the agency may be well served by enabling public
input. Both the MSHA and the FAA stressed the value of public comments, and the
MSHA observed that union representatives often provide them. It is easy to see how
additional information can help an agency make a sound nonenforcement decision.
E.

Use a Consistent Methodology, Including Written Justifications

Finally, agencies should also use a consistent methodology when evaluating
nonenforcement, and part of that methodology should include giving reasons for their
nonenforcement decisions (even if those decisions are not public). A consistent
methodology should help agencies treat like cases alike. And the use of written
explanations should do the same. Indeed, “[a]dministrative-law doctrine places reason
giving at the center of agency policymaking” 274 because, in part, doing so can encourage
sound decision-making.275 If officials use a consistent methodology and explain in
writing why nonenforcement makes sense in any particular case, there is a better chance
that the ultimate decision will be, and will be perceived as being, evenhanded.
274 Jodi L. Short, The Political Turn in American Administrative Law: Power, Rationality, and Reasons, 61
DUKE L.J. 1811, 1887 (2012).
275 See, e.g., Aaron L. Nielson & Christopher J. Walker, The New Qualified Immunity, 89 S. CAL. L. REV.

1, 56 (2015) (“Perhaps the primary objective of a reason-giving requirement is to encourage the
decisionmaker to make rational, consistent decisions, considering all of the relevant factors. The idea is
that a procedural requirement, by focusing attention on a particular danger, should foster better
substantive outcomes. The practice of giving reasons, in other words, should improve the quality of
decision making.”).

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The EBSA process for nonenforcement illustrates the benefits of written
justifications. As a rule, the agency prepares “a published proposed exemption” that
“contains an analysis of how the record supports the regulatory finding,” and a
“published grant of an exemption contains a discussion of any comments received in
respect of a proposed exemption, an applicant’s response to such comments, and the
EBSA’s consideration of such comments and responses.” 276 Doing so forces the agency
to carefully consider what it is doing and why.
Written reasons may be especially valuable if the agency prepares them with a
goal of achieving consistency across cases. In agencies that must decide whether to
engage in nonenforcement in a great many instances, with the decisions being made by
different individuals, a written explanation may be essential to maintain uniformity.
Granted, a thorough written explanation of all nonenforcement may not be realistic,
especially in agencies that address hundreds or even thousands of waiver or exemption
requests every year. The FAA has attempted to address this point by providing written
explanations for decisions that address novel issues. That approach makes sense.
Depending on the nature of an agency’s authority, other possible ways to determine
whether a detailed explanation should be given may involve focusing on the number of
people affected or the dollar amounts at issue. These considerations are not meant to be
exhaustive; the idea is to identify the most important nonenforcement decisions. Some
agencies, by contrast, do not confront that many waiver or exemption requests. For
them, it may make sense to prepare a detailed written explanation of the agency’s
decision, with reasons, for each one.
Giving reasons certainly makes sense if nonenforcement decisions are public. If
agencies explain why they act, the public can have greater confidence that the agency’s
decisions are coherent and proper. Well-articulated consistency thus can enhance
public confidence in the regulatory process. Yet even if an agency determines that it
does not wish to make its nonenforcement decisions public, it still may be benefited by
articulating in writing the reasons for them. This is true because even apart from the
public benefits of a written explanation, the very act of preparing an explanation should
help the agency identify when nonenforcement does and does not make sense.

276 EBSA Survey Response, supra note 166.

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CONCLUSION
Agencies often “bring the hammer down” when legal duties have been breached.
But sometimes agencies stay their hand. Such nonenforcement raises important
questions. There are good reasons for nonenforcement, but it also brings with it
dangers. Like much in administrative law, the value of discretion must be balanced
against the danger of discretion’s abuse. Just because there is tension, however, does
not mean that nonenforcement should be rejected. Even if it were possible to eliminate
nonenforcement altogether (and often it is not possible because of resource constraints),
it would not be desirable. Nonenforcement has a place in administrative law. Even so,
awareness of the tension—especially coupled with a more complete conceptual
understanding, greater empirical information, and careful safeguards against abuse—
will benefit the regulatory process.

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APPENDIX: SURVEY INSTRUMENT
This appendix contains the questions—divided into five Parts—that were sent to agency
officials. Note that at the end of Parts I to IV, the official was asked whether the agency
would be willing to discuss its policy, either on or off the record, with an ACUS
consultant.
Part I: Statutory or Regulatory Waivers
Question 1: Does [Agency] have specific statutory authority to waive statutory
or regulatory requirements for parties that would otherwise be subject to them?
If yes, please list such statutory sources of authority and proceed to questions a) through
f) below. If no, please skip to Part II.
[Clarification included as a footnote: Please do not include statutory provisions
that authorize waivers to States as cooperative regulators but do include
statutory provisions that authorize waivers to States as regulated entities.]
Question 1(a). Approximately how many requests for such waivers does
[Agency] receive in a typical year?
Question 1(b). Approximately what percentage of such waiver requests does
[Agency] grant?
Question 1(c). Does the agency ever grant such a waiver without a request?
If so, how often?
Question 1(d). Please briefly describe the procedures [Agency] uses to review
potential waivers.
Question 1(e). Does [Agency] publish its decisions regarding such waivers in
the Federal Register or otherwise make them publicly available?
Question 1(f). Does [Agency] have any standing policy, whether internal or
published, to guide its decisions regarding such waivers?

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Part II: Waivers to States
Question 2. Some agencies grant “cooperative federalism” waivers to states, for
instance where the state seeks authority to supplement or amend a federal
program or where states are preempted from acting in a particular field but may
seek a waiver from preemption to act. Does [Agency] oversee any programs in
which states are statutorily eligible for waivers from otherwise-applicable
statutory or regulatory requirements?
If yes, please list such “cooperative federalism” programs and proceed to questions a)
through f) below. If no, please skip to Part III.
Question 2(a). Approximately how many requests for such “cooperative
federalism” waivers does [Agency] receive in a typical year?
Question 2(b). Approximately what percentage of such waiver requests does
[Agency] grant?
Question 2(c). Does the agency ever grant such a waiver to a State without a
request? If so, how often?
Question 2(d). Please briefly describe the procedures [Agency] uses to review
such waiver requests.
Question 2(e). Does [Agency] publish its decisions on such waiver requests
in the Federal Register or otherwise make them publicly available?
Question 2(f). Does [Agency] have any standing policy, whether internal or
published, to guide its decisions regarding “cooperative federalism” waivers
to States?
Part III: Equitable Exemptions
Question 3. Does [Agency] ever exercise its equitable power to exempt from
regulatory requirements any entity that would otherwise be subject to them?
If yes, please proceed to questions a) through f) below. If no, please skip to Part IV.
[Clarification included as a footnote: Please do not include exercises of
prosecutorial discretion, which will be addressed in Part IV. Instead, please limit
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your answer to written exemptions that are granted before any known violation
has occurred. Likewise, the focus of this Part is also distinct from Part I. Part I
addresses specific statutory authority to waive regulatory requirements while
Part III is concerned with exemptions without such specific statutory authority.]
Question 3(a). Approximately how many requests for such exemptions does
[Agency] receive in a typical year?
Question 3(b). Approximately what percentage of such requests does
[Agency] grant?
Question 3(c). Does the agency ever grant such an equitable exemption
without a request? If so, how often?
Question 3(d). Please briefly describe the procedures [Agency] uses to review
such exemption requests.
Question 3(e). Does [Agency] publish its decisions on such exemption
requests in the Federal Register or otherwise make them publicly available?
Question 3(f). Does [Agency] have any standing policy, whether internal or
published, to guide its decisions regarding such exemptions?
Part IV: Prosecutorial Discretion
Question 4. Does [Agency] ever exercise its prosecutorial discretion (i.e., choose
not to enforce the law against known violations of statutory or regulatory
requirements under [Agency]’s jurisdiction) to essentially exempt from statutory
or regulatory requirements any entity that would otherwise be subject to them?
If yes, please proceed to questions a) through f) below. If no, please skip to Part V.
Question 4(a). Does an entity subject to statutory or regulatory requirements
ever request [Agency] to exercise prosecutorial discretion?
If so,
approximately how often?
Question 4(b). Approximately how many times in a typical year does
[Agency] exercise its prosecutorial discretion?

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Question 4(c). Does [Agency] ever notify violators, complainants, or the
public that it is choosing not to pursue a particular enforcement action
because of prosecutorial discretion? If yes, are those notifications published in
the Federal Register or otherwise publicly available?
Question 4(d). Does [Agency] have any standing policy, whether internal or
published, to guide its exercises of prosecutorial discretion?
Part V: Miscellaneous
Question 5. Does [Agency] have practices or procedures akin to those mentioned
above (i.e., ways to essentially exempt someone from complying with a statutory
or regulatory requirement or to excuse a violation of a statutory or regulatory
requirement) that has not yet been discussed? If yes, what are those practices
and procedures and how do they work?
Question 6. Do government officials outside of [Agency] ever participate in
decisions of [Agency] to grant a statutory waiver, a waiver to a State, an
equitable exemption, an exercise of prosecutorial discretion, or the like? If yes,
would [Agency] be willing to discuss such participation, either on or off the
record, with an ACUS consultant?
Question 7. Can you think of “best practices” that would help agencies to
evaluate whether to grant waivers or exemptions? If so, what are they and why
do you think they would help?
Question 8. The U.S. Court of Appeals for the D.C. Circuit has emphasized the
need for greater clarity on the criteria used to make waiver determinations to
ensure fairness to all parties. Specifically, the court warned that: “If discretion is
not restrained by a test more stringent than ‘whatever is consistent with the
public interest (by the way, as best determined by the agency),’ then how to
effectively ensure power is not abused?” Do you agree with this view? Why or
why not?

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