Opinion ID: 1154748
Heading Depth: 2
Heading Rank: 1

Heading: The regulation is authorized by statute.

Text: Initially, we must determine whether the authorizing statutes require the commissioner to promulgate procedural regulations, substantive regulations, or both. Section .055(2) clearly limits the commissioner's authority to adoption of procedural regulations concerning dividend applications and proof of dividend eligibility. Section .015(a), on the other hand, can reasonably be read to encompass both procedural and substantive regulations. We conclude that section .015(a) requires the commissioner to adopt regulations setting substantive eligibility requirements for permanent fund dividends. We reach this conclusion for two reasons. First, if the legislature had intended the delegation contained in .015(a) to pertain strictly to matters of procedure, the legislature likely would have used language plainly expressing this limitation, as it did in AS 43.23.055(2). Second, if the legislature intended only a procedural meaning, AS 43.23.015(a) would be superfluous because of the presence of section .055(2). Since no statute should be construed to be merely superfluous if it reasonably has another meaning, Homer Electric Association v. Towsley, 841 P.2d 1042, 1045 (Alaska 1992), we conclude that section .015(a) delegates authority to the commissioner to promulgate regulations dealing with substantive eligibility requirements. This case, therefore, reduces to a single question: whether 15 AAC 23.615(d), as construed by the hearing officer and the commissioner to restrict permanent fund dividend eligibility to aliens with resident alien or refugee status, falls within the commissioner's delegated authority to regulate the eligibility of individuals for permanent fund dividends. In answering this question, we accord the administrative regulation a presumption of validity; the party challenging the regulation bears the burden of demonstrating invalidity. Alaska Int'l Indus. v. Musarra, 602 P.2d 1240, 1245 n. 9 (Alaska 1979). We review a legislative type of regulation, such as is presented here, with considerable deference: First, we will ascertain whether the regulation is consistent with and reasonably necessary[ [1] ] to carry out the purposes of the statutory provisions conferring rulemaking authority on the agency. This aspect of review insures that the agency has not exceeded the power delegated by the legislature. Second, we will determine whether the regulation is reasonable and not arbitrary. This latter inquiry is proper in the review of any legislative enactment. Kelly v. Zamarello, 486 P.2d 906, 911 (Alaska 1971). We will not substitute our judgment for that of the agency with respect to the efficacy of the regulation nor review the wisdom of a particular regulation. Alaska Int'l Indus. v. Musarra, 602 P.2d at 1245 n. 9. The commissioner argues that the regulation in question adds a permissible gloss to the statutory phrase intent to remain permanently in the state, AS 43.23.095(8). The commissioner cites Whaley v. State, 438 P.2d 718 (Alaska 1968), as authority for the proposition that an agency having authority to make legislative regulations may by regulation refine and add meaning to statutory language. In Whaley, various personnel rules excluded probationary or provisional employees from the statutory classification employee[s] in the classified service although the statute itself did not contain such an exclusion. We upheld the exclusion as within the authority of the director of personnel: Such interpretative rules were made pursuant to statutory authority, and appellant does not point out, nor do we perceive, that those rules are unreasonable and not in accord with the terms and purposes of the statute pursuant to which they were adopted. We have no basis for not upholding such an administrative interpretation of AS 39.25.170 [the statute using the term employee in the classified service], particularly in view of the well settled rule that requires courts to give consideration and respect to the contemporaneous construction of a statute by those charged with its administration, and not to overrule such construction except for weighty reasons. Id. at 722 (footnote omitted). We decided, then, that the agency in Whaley had the authority to promulgate a regulation that excluded employees who arguably fell within the statute's definition. Similarly, in this case we agree that the commissioner has the authority to promulgate a regulation excluding permanent fund dividend applicants who arguably fall within the statutory definition of eligible applicants. That exclusion, however, must still be consistent with the statutory purpose and reasonable and not arbitrary. Kelly v. Zamarello, 486 P.2d at 911. These conditions are met. The objective of AS 43.23.095(8) is to limit payment of dividends to permanent residents. Those who are present in the state illegally may reasonably be seen to fall outside of this category. The challenged regulation accomplishes this. The commissioner justifies this regulation by, in effect, interpreting the statutory phrase intent to remain permanently to mean intent to lawfully remain permanently, inferring a requirement of lawful action from the statute. We have made similar inferences in other statutory contexts. For example, in Colville Environmental Services v. North Slope Borough, 831 P.2d 341, 349 (Alaska 1992), a statute gave grandfather rights to municipalities which provided garbage collection services before a certificate of authority was granted to a competing provider of such services. The question was whether the statutory language provided similar services referred to all services or only lawfully provided services. We construed the statute to apply only where the municipality had lawfully provided services. Similarly, in Simpler v. State Commercial Fisheries Entry Commission, 728 P.2d 227, 230 (Alaska 1986), the litigant challenged an agency regulation that required prior fishing as the holder of both an interim-use permit and a gear license in order to qualify for grandfather rights in a fishery. The regulation was challenged as inconsistent with the authorizing statute which only required prior fishing as the holder of a gear license. We upheld the regulation, noting that one could not legally fish without both a gear license and an interim-use permit. The regulation was held to be consistent with the act based on the inference that the legislature intended to establish eligibility based on lawful participation. Id. Underlying both of these decisions is an assumption that the legislature did not intend to reward unlawful conduct. The commissioner was entitled to make the same assumption in this case. One objective of section .015(a) is to require the commissioner to make substantive regulations resolving questions as to who is and who is not a permanent resident. 15 AAC 23.615(d) is such a regulation. It makes abundant sense to conclude that aliens who may not legally live in Alaska are not permanent residents for dividend purposes. To exclude such people from the permanent fund dividend program is consistent with a public policy which regards it as unwise to reward illegality. The regulation, therefore, is not invalid on statutory grounds.