Supreme Court’s ruling on Chevron framework will lead to policy shifts by federal emergency management and housing agencies

On June 28, 2024, the Supreme Court's 6-3 decision in Loper Bright Enterprises v. Raimondo abolished the Chevron doctrine, ending its 40-year influence on how courts review agency legal decisions. This ruling dramatically affects how federal agencies like FEMA, HUD, and HHS, interpret laws, with wide-reaching implications for agency leaders and the people they serve.

Eliminating Chevron deference means courts will no longer automatically defer to agencies' interpretations of ambiguous laws. Judges will have more authority to interpret statutes, possibly leading to more judicial challenges and overturned agency decisions. The decision will affect FEMA and set a precedent for other federal entities, potentially leading to a more fragmented regulatory landscape that results in longer timelines for resolving challenges or appeals to an agency’s interpretation of its authorizing statute. 

Chevron deference, a doctrine established in the 1984 Supreme Court case Chevron U.S.A., Inc. v. Natural Resources Defense Council, allowed courts to defer to federal agencies' reasonable interpretations of unclear laws. This doctrine acknowledged the expertise of these agencies and granted them flexibility to execute complex laws. 

Particular to the emergency management industry, the Robert T. Stafford Disaster Relief Act (Stafford Act) is broad and general, allowing flexibility in FEMA's eligibility determinations for their programs, such as Public Assistance, Building Resilient Infrastructure and Communities, and the Hazard Mitigation Grant Program.  

The most significant impact could be felt on FEMA eligibility decisions, especially those based on unclear laws. These decisions are now more likely to face judicial scrutiny, which could lead to an increase in appeals and legal challenges, prolonging resolution times and raising costs for applicants and stakeholders. 

The ruling could also affect second appeals in FEMA's PA, BRIC, and HMGP programs. Previously, agency discretion often led to upheld decisions. Now, courts might only review these decisions by deferring to FEMA's expertise. This change could reopen appeals from the past six years and offer new chances to challenge FEMA's authority, especially when its goals and program intentions are considered. 

Eliminating Chevron deference will not only impact future FEMA determinations, but it could potentially alter previous determinations as well. Determinations from the past six years could be contested, potentially triggering a review of many previous decisions. This would cause a backlog and raise the administrative load on FEMA and state/municipal applicants facing these issues in court. 

FEMA is not alone in facing a new regulatory landscape following the Supreme Court’s decision. There are also implications to HUD's interpretations of Section 8 Housing Choice Voucher Program, Community Development Block Grant -Disaster Recovery, Public Housing programs, Fair Housing Initiatives Program,  HOME Investment Partnership (HOME) Program, and numerous others.

Health and Human Services (HHS) also may anticipate challenges to states' interpretations of Medicare and Medicaid use of funds, and eligibility interpretations of Temporary Assistance for Needy Families , Children's Health Insurance Program, program requirements for Head Start and Early Head Start Programs, and the grant allocations, eligibility, and compliance choices made for Substance Abuse and Mental Health Services Administration Programs.

Collectively, programs impacted by the Supreme Court ruling serve tens of millions of Americans and the changes it brings will have real-world implications. FEMA may soon revise its policies and guidelines on disaster relief to make eligibility decisions less dependent on unclear statutory interpretations and more based on clear, defensible legal language. Good in theory, but it also diminishes the flexibility required to meet the unique challenges each disaster poses.

The Increased litigation that may follow the ruling could force FEMA to spend more on legal defense and compliance, possibly reducing funds for program implementation. This too might limit FEMA's flexibility in designing programs tailored to specific needs. 

The Supreme Court's decision on Chevron deference is creating a whole new world for federal agencies like FEMA, HUD, and HHS and how they interact with the courts. Without the judicial deference that has existed for decades, these agencies must interpret laws under increased legal scrutiny, likely leading to significant policy shifts in areas like emergency management and housing with real world implications for the Americans who rely on these programs. Successfully navigating this new terrain will require federal agencies to reevaluate law implementation and establish processes for closer collaboration between legal experts and policymakers.

Mark Misczak is president of National and International Programs for Tidal Basin Group. He spent most of his career serving in leadership roles at the Federal Emergency Management Agency.