Congress has created numerous administrative agencies to implement and enforce delegated regulatory authority. Federal statutes define the scope and reach of agencies' power, granting them discretion to, for example, promulgate regulations, conduct adjudications, issue licenses, and impose sanctions for violations of the law. The Administrative Procedure Act (APA) confers upon the judiciary an important role in policing these statutory boundaries, directing federal courts to "set aside agency action" that is "not in accordance with law" or "in excess of statutory jurisdiction, authority, or limitations." Courts will thus invalidate an action that exceeds an agency's statutory authorization or otherwise violates the law. Of course, in exercising its statutory authorities, an agency necessarily must determine what the various statutes that govern its actions mean. This includes statutes the agency specifically is charged with administering as well as laws that apply broadly to all or most agencies. As this report explains, when a court reviews an agency's interpretation of a statute it is charged with administering, the court will generally apply the two-step framework outlined by the Supreme Court in Chevron U.S.A., Inc. v. Natural Resources Defense Council . Pursuant to that rubric, at step one, courts examine "whether Congress has directly spoken to the precise question at issue." If so, "that is the end of the matter" and courts must enforce the "unambiguously expressed intent of Congress." In the case of statutory silence or ambiguity, however, step two requires courts to defer to a reasonable agency interpretation of the statutory text, even if the court would have otherwise reached a contrary conclusion. This report discusses the Chevron decision, explains the circumstances in which the Chevron doctrine applies, explores how courts apply the two steps of Chevron , and highlights some criticisms of the doctrine, with an eye towards the potential future of Chevron deference. The Chevron case itself arose out of a dispute over the proper interpretation of the Clean Air Act (CAA). The contested statutory provision required certain states to create permitting programs for "new or modified major stationary sources" that emitted air pollutants. In 1981, the Environmental Protection Agency (EPA) promulgated a regulation that defined "stationary source," as used in that statute, to include all pollution-emitting activities within a single "industrial grouping," and thus let states "bubble," or group together, all emitting sources in a single plant for the purposes of assessing emissions. This allowed a facility to construct new pollution-emitting structures so long as the facility as a whole—that is, the "stationary source"—did not increase its emissions. The Natural Resources Defense Council (NRDC) filed a petition for judicial review, arguing that this definition of "stationary source" violated the CAA. The NRDC claimed that the text of the CAA required the EPA "to use a dual definition—if either a component of a plant, or the plant as a whole, emits over 100 tons of pollutant, it is a major stationary source." A unanimous Supreme Court disagreed and upheld the regulation, determining that the EPA's definition was "a permissible construction of the statute." The Court explained that when a court reviews an agency's interpretation of a statute it administers, it faces two questions: First, always, is the question whether Congress has directly spoken to the precise question at issue. If the intent of Congress is clear, that is the end of the matter; for the court, as well as the agency, must give effect to the unambiguously expressed intent of Congress. If, however, the court determines Congress has not directly addressed the precise question at issue, the court does not simply impose its own construction on the statute, as would be necessary in the absence of an administrative interpretation. Rather, if the statute is silent or ambiguous with respect to the specific issue, the question for the court is whether the agency's answer is based on a permissible construction of the statute. Applying this two-step inquiry to review the challenged EPA regulation, the Court first considered the text and structure of the CAA, along with the legislative history regarding the definition of "stationary source." The text of the statute did not "compel any given interpretation of the term 'source,'" and did not reveal Congress's "actual intent." The Justices concluded that the statutory text was broad, granting the EPA significant "power to regulate particular sources in order to effectuate the policies of the Act." The legislative history of the CAA was similarly "unilluminating." However, the ambiguous legislative history was "consistent with the view that the EPA should have broad discretion in implementing the policies of" the CAA. Ultimately, the Court decided that the EPA had "advanced a reasonable explanation" for determining that its definition of "source" advanced the policy concerns that had motivated the CAA's enactment, and upheld this "permissible construction." The Court gave three related reasons for deferring to the EPA: congressional delegation of authority, agency expertise, and political accountability. First, the Court invoked a judicial presumption about legislative intent, which has subsequently become one of the leading justifications for deferring to agencies under Chevron : If Congress has explicitly left a gap for the agency to fill, there is an express delegation of authority to the agency to elucidate a specific provision of the statute by regulation.... Sometimes the legislative delegation to an agency on a particular question is implicit rather than explicit. In such a case, a court may not substitute its own construction of a statutory provision for a reasonable interpretation made by the administrator of an agency. In the view of the Court, because the statutory term "source" was ambiguous and could be read either to prohibit or to allow "bubbling," Congress had implicitly delegated to the EPA the ability to choose any definition that was reasonably permitted by the statutory text. The statutory ambiguity constituted a limited delegation of interpretive authority from Congress, and the agency had acted within that delegation. Second, the Court cited the greater institutional competence of agencies, as compared to courts, to resolve the "policy battle" being waged by the litigants. The Court reasoned that, with its superior subject matter expertise, the EPA was better able to make policy choices that accommodated "manifestly competing interests" within a "technical and complex" regulatory scheme. Finally, the opinion of the Court also rested implicitly on concerns about the constitutional separation of powers. While judges should not be in the business of "reconcil[ing] competing political interests," the Court stated, it was "entirely appropriate for this political branch of the Government to make such policy choices—resolving the competing interests which Congress itself either inadvertently did not resolve, or intentionally left to be resolved by the agency charged with the administration of the statute in light of everyday realities." An important threshold question for a court reviewing an agency's interpretation of a statute is whether Chevron deference should apply at all. As an initial matter, the Chevron framework of review is limited to agencies' interpretations of statutes they administer. Even when an agency is interpreting a statute that it administers, however, the Supreme Court has prescribed important limits on the types of agency statutory interpretations that qualify for Chevron deference. One crucial inquiry, sometimes referred to as Chevron "step zero," is whether Congress has delegated authority to the agency to speak with the force of law. This analysis often turns on the formality of the administrative procedures used in rendering a statutory interpretation. The Court has indicated that an agency's determination of the scope of its jurisdictional authority is entitled to Chevron deference in appropriate circumstances. Another situation where the Court has occasionally declined to follow Chevron occurs when an agency's interpretation implicates a question of major "economic and political significance." However, this "major questions" doctrine has been invoked in a somewhat ad hoc manner, leaving unclear exactly how this consideration fits into the Chevron framework. Importantly, even if the Chevron framework of review does not apply, a court might still give some weight to an agency's interpretation of a statute. In the 2000 case of United States v. Mead Corp. , the Court explained that even when Chevron deference was inapplicable to an agency's interpretation, it might still merit some weight under the Court's pre- Chevron decision in Skidmore v. Swift & Co . Under Skidmore , when an agency leverages its expertise to interpret a "highly detailed" "regulatory scheme," a court may accord the agency's interpretation "a respect proportional to its 'power to persuade.'" In other words, a court applying  Skidmore  deference accords an agency's interpretation of a statute an amount of respect or weight that correlates with the strength of the agency's reasoning. Finally, when an agency interprets legal requirements that apply broadly across agencies, it is not operating pursuant to delegated interpretive authority to resolve ambiguities or relying on its particular expertise in implementing a statute, and the agency's interpretation is not afforded deference by a reviewing court. For instance, courts will review de novo, or without any deference at all, procedural provisions of the APA, the Freedom of Information Act, and the Constitution. Determining whether Chevron deference applies to an agency's interpretation typically requires a court to examine whether Congress delegated authority to the agency to speak with the force of law in resolving statutory ambiguities or to fill statutory gaps. One important indicator of such a delegation is an agency's use of formal procedures in formulating the interpretation. As background, the APA requires agencies to follow various procedures when taking certain actions. For instance, agencies issuing legislative rules that carry the force of law generally must follow notice and comment procedures; and adjudications conducted "on the record" must apply formal court-like procedures. In contrast, non-binding agency actions, such as agency guidance documents, are exempt from such requirements.