Home > Ad Law > Arbitrary and Capricious Cost-(Non)Consideration After Michigan v. EPA

Arbitrary and Capricious Cost-(Non)Consideration After Michigan v. EPA

Karmina Caragan
85 Geo. Wash. L. Rev. 1514

Initially, Supreme Court decisions suggested a presumption that, absent affirmative congressional intent, agencies should not consider costs when deciding whether to regulate. In the last few years, however, the Supreme Court has departed from this perceived presumption, and instead held that absent clear statutory prohibition agencies may consider costs at their discretion. In Michigan v. EPA, the Court went even further by holding that absent clear statutory prohibition agencies must consider costs. While the Court forewarned invalidation of agency action without reasonable cost-consideration at the first stage, it stopped short of prescribing a particular method sufficient to survive Michigan. This Essay proposes that, at a minimum, agencies should base their decision to regulate on a Regulatory Impact Analysis (“RIA”). While this will not necessarily guarantee survival of arbitrary and capricious review under Motor Vehicle Manufacturers Ass’n v. State Farm Insurance Co., RIA-based agency action will likely survive Michigan’s mandate.

Read the Full Essay Here.

Leave a Reply