If regulators make the rules, what is Congress doing?

By Greg Walcher | Commentary, GregWalcher.com

An interesting case in Tennessee focuses on Congress delegating its legislative power to others – for decades. Not just to executive branch agencies, but in some situations to anyone at all. In Tennessee Riverkeeper v. City of Luttrell, an environmental group from another state (Alabama) sued the tiny town of Lutrell, population 1,000, over its wastewater treatment facility. Neither the federal EPA nor state environmental regulators had any problem with Lutrell. But in the Clean Water Act of 1972, Congress explicitly authorized “citizen suits,” whereby anyone can file suit to enforce the law. Like legalized vigilantes.

Lutrell, the boyhood home of Chet Atkins, fought back, asking the U.S. Supreme Court to decide whether Congress has any right to delegate enforcement power to anybody in the country. That Alabama group has filed over two dozen similar suits, making a good living by suing, settling, and cashing in. The targets are easy, because Congress specifically authorized citizen suits to enforce the Clean Air Act, Clean Water Act, Endangered Species Act, and other environmental laws. The same Congress created the FBI, EPA, and other law enforcement agencies, so why the need to let others enforce the laws?

Numerous agencies have followed Congress’s lead to a logical extreme, naming outside groups as official “stakeholders” in federal decision-making – often groups who have no identifiable “stake” in the process. Nor is the practice unique to government – it happens in business, too.

Some years ago, when Texas power giant TXU announced plans for 11 new coal-fired power plants, it was immediately sued by two environmental industry groups. The groups launched a web site called StopTXU.com, published electronic newsletters, and built a national constituency for the cause.

It paid off. Two massive investment firms collaborated on the largest leveraged buyout in history up to that time ($45 billion), but only on the condition that the two environmental groups approved the deal. The buyers would not risk the investment with unpopular proposals and lawsuits hanging over it. The resulting plan cut new power plants from 11 to 3. The company agreed to spend $400 million on energy-efficiency programs, double its purchase of wind power, and support a U.S. greenhouse gas emission cap.

Thus, two groups without a dime at stake sat at the table on Wall Street dictating details of the largest deal of its kind in business history.

Giving groups a seat at the table, whether they have any “stake” has become routine in the years since. As a former member of the management committee of the Upper Colorado River Endangered Fish Recovery Program, I was amazed that the official governing “partners” include not only the states, tribes, utilities, and water users, but also a Boulder environmental activist group and The Nature Conservancy, the world’s largest environmental organization ($10 billion in assets, revenue nearly $2 billion a year).

Who decided such groups were official partners, overseeing a $100 million government program?

The original designees at the first meeting simply elected themselves and added a few of their friends. But make no mistake, Congress knowingly ratified the arrangement by continually paying its costs, just as it continuously delegates to others the authority to make and enforce laws.

For example, in 2020 Congress established the Horseracing Integrity and Safety Authority to set uniform racetrack safety, medication, and anti-doping rules. It sounds like an important government body, but in fact it is a private, nonprofit corporation run by private individuals. None of them are appointed by the president or any other executive official, nor can any official remove them. Yet they have authority to issue binding rules, impose civil fines up to $100,000, prosecute people in federal court, seek permanent injunctions, establish safety standards, impose strict rules, and even ban someone for life. Its own funding comes mostly from fines it imposes.

Does Congress really have the power to give such authority to private actors? If so, why does the Constitution say all government power is vested in the legislative, executive, and judicial branches? 

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