What are Administrative Agencies?

Cite this article as:"What are Administrative Agencies?," in The Business Professor, updated January 4, 2015, last accessed July 8, 2020, https://thebusinessprofessor.com/lesson/what-are-administrative-agencies/.
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What Are Administrative Agencies?
This article provides a brief description of what are administrative agencies of the US Government.

Next Article: Functions of Administrative Agencies


What are “Administrative Agencies”

Federal administrative agencies are bodies implicitly authorized by the US Constitution and created by Congress to enforce statutes and develop regulations in furtherance of those statutes. That is, administrative agencies assist the legislative branch in developing and the executive branch in executing laws. Administrative agencies include departments, agencies, commissions, bureaus, boards, government corporations, and committees. Most administrative agencies fall under the control of the executive branch. There are, however, a few administrative agencies that are directly under the control of Congress, such as the Congressional Budget Office and the Library of Congress. The authority of the President over an administrative agency depends upon the genesis of the agency and whether it is an “executive agency” or “independent agency”.

  • Executive Agencies – The US Constitution establishes the executive branch of the federal government and allows the President to establish employ agencies to carry out the executive function. Executive agencies include all of the departments under the President’s authority. The heads of the executive agencies are cabinet members who report directly to and are closely controlled by the President. The President nominates individuals to these positions and the Senate must approve these nominations by a simple majority vote. The President has complete discretion in removing these individuals from their positions.
    • Example: Examples of Executive Agencies include: Department of Defense (DOD); Department of Justice (DOJ); Department of State (DOS); Department of the Treasury (DOT); Department of Homeland Security (DOHS); Department of Health and Human Services (DHHS); Department of Energy (DOE); Internal Revenue Service (IRS).
  • Independent Agencies – Independent agencies, as the name implies, operate with a degree of independence or autonomy from the executive branch. These agencies are not part of the President’s cabinet; rather, they exist independently pursuant to congressional statute. Congress will pass what is known as an “enabling statute”, that establishes an administrative agency and outlines the extent of the agency’s authority.
    • Example: Independent federal agencies include the: Central Intelligence Agency (CIA); Federal Communications Commission (FCC); Federal Energy Regulatory Commission (FERC); Social Security Administration (SSA); Federal Reserve Board of Governors (Federal Reserve); Federal Trade Commission (FTC); General Services Administration (GSA); International Trade Commission (ITC); Environmental Protection Agency (EPA); National Labor Relations Board (NLRB); Securities and Exchange Commission (SEC); Commodities Futures Trading Commission (CFTC); United States Postal Service (USPS); National Aeronautics and Space Administration (NASA); Federal Election Commission (FEC); National Transportation Safety Board (NTSB); National Science Foundation (NSF); Small Business Administration (SBA); Nuclear Regulatory Commission (NRC).

Executive and independent agencies carry on similar functions; however, an independent agency generally has more of a regulatory function, where an executive agency plays more of an enforcement role.

Discussion: How do you feel about the role of agencies in the development and execution of laws? Do you find surprising the breadth and number of agencies?

Discussion Input

  • When considering the vast number of laws in the US legal system, the difficulty in developing regulations, and the requirements to enforce them, it makes a strong argument for the need for and utility of administrative agencies. Though, someone who is frustrated by the extensive procedural requirements and bureaucracy surrounding administrative agencies may be tempted to argue that they are largely unnecessary.

Practice Question: Thomas is listening to a heated political discussion at the office water cooler. One colleague is expressing her frustration at the current state of the regulations surrounding an area of business practice. She is blaming the President for not taking steps to ease the regulatory burden. The other colleague is defending the President and arguing that the bureaucracy is a result of Congress’ shortcomings. What information would you need to determine which colleague is more accurate (or at least informed) in her statement?

Proposed Answer

  • First, you would need to determine what are the sources of the regulations. That is, you would want to determine whether the agency making the regulations is an executive agency or independent agency. It is likely that the frustration concern an independent agency, as executive agencies are less involved in the quasi-legislative function.

Academic Research

Spurlin, Candice J. and Garry, Patrick M. and Bishop, Jami and Hollers, Logan and Boyle, Joseph, The Role of Public Comment in the Administrative Agency Process: A Case Study of the Rulemaking Processes of One South Dakota Agency (June 1, 2011). Sustainable Development Law Journal, Vol. 14, p. 148, 2011. Available at SSRN: https://ssrn.com/abstract=2017708

Froomkin, A. Michael, Note, In Defense of Administrative Agency Autonomy (1987). Yale Law Journal, Vol. 96, 1987. Available at SSRN: https://ssrn.com/abstract=2715762

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