Supreme Court Ruling Reins In Federal Bureaucrats

Legal
Published
Contacts: Thomas Ward
[email protected]
VP, Legal Advocacy
(202) 266-8230

Jeff Augello
[email protected]
AVP, Association Counsel
(202) 266-8490

In a major victory for NAHB and the housing community, the U.S. Supreme Court has issued a ruling to reform the nation’s broken regulatory rulemaking process by ensuring that federal courts interpret federal statutes and no longer defer to the interpretations of federal bureaucrats. 

“Today’s Supreme Court ruling is an important step forward to advance meaningful regulatory reform because it means that federal agencies can no longer continuously change the law — and the intent of Congress — by implementing their own interpretation of statutes as long as those interpretations are viewed as being ‘reasonable,’” said NAHB Chairman Carl Harris.

The case may prove to be a game-changer for builders and developers who must interact with any part of the federal government. For home building, this means that every federal agency that builders and developers must deal with — from the U.S. Department of Housing and Urban Development to the Environmental Protection Agency, the Department of Labor, the Occupational Safety and Health Administration and more — will have less discretion to impose new regulations that Congress did not clearly authorize.

The Supreme Court verdict was made in two cases — Relentless v. Dept. of Commerce and Loper Bright Enterprises v. Raimondo — where the plaintiffs sought to overturn a previous decision made by the nation’s highest court 40 years ago that gave the government an unfair advantage when someone challenges a regulation in court. NAHB filed a friend-of-the-court brief on behalf of both plaintiffs.

In 1984, the Supreme Court issued an opinion that created the “Chevron deference” doctrine, which requires courts to abide by a statute if it is “clear,” but also requires courts to defer to a federal agency’s interpretation of an unclear statute if the interpretation is “reasonable,” even if it is not the best interpretation. In other words, Chevron gives federal agencies wide latitude to interpret the scope of the nation’s laws.

Ruling in the 6-3 majority opinion to overturn Chevron (the two cases were decided together and the decision in the Loper-Bright case was 6-2 because Justice Ketanji Brown Jackson was recused), Chief Justice John Roberts said the presumption that statutory ambiguities are implicit delegations of authority by Congress to federal agencies “is misguided,” because “agencies have no special competence in resolving statutory ambiguities. Courts do.”

He further explained that “‘[A]mbiguity’ is a term that may have different meanings for different judges. One judge might see ambiguity everywhere; another might never encounter it. A rule of law that is so wholly in the eye of the beholder invites different results in like cases and is therefore arbitrary in practice. Such an impressionistic and malleable concept cannot stand as an every-day test for allocating interpretive authority between courts and agencies.”

The cases of Relentless v. Dept. of Commerce and Loper Bright Enterprises v. Raimondo involved a National Marine Fisheries Service regulation that requires fishermen to pay for federal observers to board their ships and observe their fishing practices. While the governing statute says the agency can require federal observers on the ships, it is silent on whether the fishermen must pay their salaries. The lower courts upheld the regulation based on Chevron deference.

NAHB has a long history of fighting against Chevron deference because it allows federal agencies to write the laws, enforce the laws and interpret the laws. It invites Congress to draft vague legislation and empower federal agencies that are less politically accountable. Chevron deference also inhibits courts from exercising their constitutional power to interpret the law. Taken together, this results in an ever-growing number of burdensome regulations that Congress did not authorize and the courts do not check.

As a result of today’s landmark ruling, the power of the legislature, executive and judicial branches will no longer be merged in the hands of unelected bureaucrats.

Subscribe to NAHBNow

Log in or create account to subscribe to notifications of new posts.

Log in to subscribe

Latest from NAHBNow

Safety

Jul 01, 2025

Use NAHB Resources to Protect Workers from Heat and UV Exposure

As NAHB celebrates UV Safety Awareness Month in July, it is important for home builders and general contractors to educate workers about the potential risks associated with UV radiation, and have plans and resources in place to keep them safe on the jobsite.

Advocacy

Jul 01, 2025

Senate Passes Tax Bill With Many Wins for NAHB Members

The Senate today passed the One Big Beautiful Bill Act (H.R. 1) — sweeping tax and domestic policy legislation that includes several important housing and business provisions that will benefit small businesses, real estate and our members. Most notably, NAHB was able to secure key wins regarding state and local tax deductions for individuals and pass-through businesses.

View all

Latest Economic News

Economics

Jul 01, 2025

May Private Residential Construction Spending Dips

Private residential construction spending fell by 0.5% in May, marking the fifth straight month of decreases. This drop was primarily driven by reduced spending on single-family construction. Compared to a year ago, total spending was down 6.7%, as the housing sector continues to navigate the economic uncertainty stemming from ongoing tariff concerns and elevated mortgage rates.

Economics

Jul 01, 2025

Flat Job Openings for Construction

The count of open, unfilled positions in the construction industry held steady amid a slowdown for housing, per the May Bureau of Labor Statistics Job Openings and Labor Turnover Survey (JOLTS).

Economics

Jun 30, 2025

2024 New Single-Family Starts by Census Division

Despite persistently high mortgage rates, elevated financing costs for builders, and a shortage of buildable lots, single-family starts rebounded in 2024, following two straight years of declines.