Department of Transportation v. Armacost

MURPHY, Chief Judge. The issue presented is whether the General Assembly, in enacting Maryland’s Vehicle Emissions Inspection Program (VEIP), Maryland Code (1987 Repl.Vol.) §§ 23-201 through 23-208 of the Transportation Article, violated the separation of powers provisions of Article 8 of the Maryland Declaration of Rights by unconstitutionally delegating legislative power to an administrative agency. 1 ⁶⁶ I In 1970, Congress enacted the Federal Clean Air Act to combat the growing problem of air pollution caused, in part, by the increasing use of motor vehicles. 42 U.S.C. § 7401 (a)(2) (1982).* 2 Among the Act’s purposes was the protection of public health by improving the quality of the nation’s air. § 7401(b)(1). While placing primary responsibility for the prevention and control of air pollution with the states, § 7401(a)(3), the Act empowered the Administrator of the Federal Environmental Protection Agency (EPA) to establish national ambient air quality standards for various pollutants, and to promulgate rules and regulations for attaining those standards. 3 § 7409. The Act authorized the EPA to divide the country into “air quality control region[s].” § 7407(c).

It required each state to submit for EPA approval a “state implementation plan” (SIP), setting forth the state’s program for achieving the requisite air quality standards in each of its control regions by' 1975. § 7410. Amendments to the Clean Air Act in 1977 extended the submission date of a SIP to January 1, 1979, for states with “nonattainment areas,” i.e., regions that had failed to meet the air quality standards by 1975. § 7501(2). National air quality standards were to be attained “as expeditiously as practicable,” but no later than December 31, 1982. § 7502(a)(1). States unable by 1982 to achieve the national standards for two particular pollutants—photochemical oxidants and carbon monoxide—could request an extension until December 31, 1987. § 7502(a)(2).

In exchange for ⁶⁷ this extension, however, a state’s SIP had to “establish a specific schedule for implementation of a vehicle emission control inspection and maintenance program----” § 7502(b)(ll)(B). Noncompliance could result in a loss of federal highway funds, § 7506(a), and of sewage treatment plant construction grants, § 7616. Two of Maryland’s six air quality control regions were found by both the State and the EPA to be nonattainment areas for ozone and carbon monoxide standards. These two regions were the Metropolitan Baltimore Intrastate Air Quality Control Region, consisting of Baltimore City and Anne Arundel, Baltimore, Carroll, Harford, and Howard Counties, and the Maryland portion of the National Capital Interstate Air Quality Control Region, consisting of Prince George’s and Montgomery Counties. 4 Because the requisite air quality standards for ozone and carbon monoxide could not be attained in these two regions by the 1982 deadline, the State, in January 1979, formally requested an extension of the EPA deadline.

Maryland’s VEIP, codified within the Transportation Article as Title 23, Subtitle 2, was enacted by ch. 421 of the Acts of 1979. As originally enacted, § 23-201 defined “Emissions standard” in terms of a limitation upon “the quantity, quality, rate, or concentration of emissions from a motor vehicle,” including a requirement that “relates to the operation or maintenance of a motor vehicle to assure continuous emission reduction.” Section 23-202(a) required that by October 1, 1979, the MVA publish “proposed rules and regulations providing, to the extent required by federal law, for the establishment of ⁶⁸ an emissions inspection program to commence no earlier than July 1, 1980 and no later than December 31, 1982.” Prior to drafting the proposed rules, the MVA was required by this subsection to conduct two public hearings, one each in the Washington and Baltimore metropolitan areas, in order to receive public comment. The MVA was required by the statute to submit its proposed rules and regulations to each House of the General Assembly by a specified date in 1980; it was also required to conduct public education and awareness programs on a regular basis “to inform the citizens concerning the benefits of the emissions program.” The subsection specified that after December 31, 1983, the inspection program would be mandatory for all motor vehicles in the State “not otherwise exempted.” It provided that unless legislation established a different program at the 1980 session of the General Assembly, “the proposed rules and regulations, with any amendments that shall have been concurred in by joint resolution of the General Assembly, shall take effect as provided in the rules and regulations.” Section 23-202(b) required that an inspection system be established in the State “for annual inspection, under a schedule adopted by the [MVA] Administrator, of those motor vehicles required to be inspected.” It mandated the construction of inspection facilities in strategic locations “that will best serve the public convenience.” Section 23-202(c). Section 23-203 directed that the MVA provide in its rules and regulations “for the establishment of inspection facilities.” Section 23-204 required that the inspection determine “whether each vehicle complies with the emission standards established under this subtitle for that vehicle,” and that the MVA set the fee for the inspection within specified limits.

Section 23-205. Section 23-206 required owners of motor vehicles registered in Maryland to “have the vehicle inspected, as required under this subtitle.” Section 23-207 authorized the MVA to adopt rules and regulations “as required for purposes of implementation, administration, regulation, and enforcement of the provisions of ⁶⁹ this subtitle, including rules and regulations that, consistent with federal law, exempt certain vehicles from the inspections under this subtitle.” This section also directed the Secretary of Health and Mental Hygiene, 5 with the concurrence of the Secretary of Transportation, to publish rules and regulations establishing “emission standards to be used for the inspection of motor vehicles under this subtitle.” 6 The VEIP was amended by the General Assembly during its 1980, 1981, 1982, 1983, and 1985 sessions. See, e.g., ch. 725 of the Acts of 1980 (start of the mandatory VEIP extended to “[ajfter December 31, 1982”); ch. 492 of the Acts of 1982 (extended to “[ajfter June 30, 1983”); ch. xxxxxxx 312 of the Acts of 1983 (start-up postponed until after December 31, 1983). The amendments also increased the inspection fee, ch. 725 of the Acts of 1980; allowed the MVA to issue hardship waivers, ch. 517 of the Acts of 1983, and waivers for any vehicle that failed the emissions test if the owner had actually spent a specified amount for repairs to the vehicle, ch. 725 of the Acts of 1980; exempted ambulances from VEIP inspection, ch. 549 of the Acts of 1983; and instructed the Secretaries of the Environment and Transportation to jointly report to designated legislative committees as to any modifications to the Federal Clean Air Act.

See ch. 492 of the Acts of 1982; ch. 19 of the Acts of 1985. The 1982 amendments also created a special joint committee on VEIP, comprised of three senators and three delegates to “regularly consult” with the Secretary of Transportation on the administration of the VEIP. In addition, ch. 106 of the Acts of 1985 (the Budget Bill) required an evaluation by the Departments of Transportation and Health and Mental Hygiene of the VEIP’s effectiveness. During its 1986 session, the legislature ⁷⁰ passed Senate Joint Resolution 22 calling for the establishment of a VEIP Task Force to “review options and make recommendations for the future of the Vehicle Emissions Inspection Program.” The Task Force, which was composed, inter alia, of three delegates, three senators, and representatives from the Department of Transportation and the Department of Health and Mental Hygiene, issued its findings and recommendations to the General Assembly and the Governor in January 1987.

II On January 11, 1984, the County Commissioners of Carroll County, in their individual and official capacities, the town of Mt. Airy, its mayor, and a resident of Carroll County (appellees) filed a petition for declaratory judgment and an interlocutory injunction in the Circuit Court for Carroll County. Named as defendants were the Department of Health and Mental Hygiene, the Department of Transportation, and the MVA (the State). The appellees challenged the constitutionality of the VEIP’s application to Carroll County, raising the issues of equal protection, substantive and procedural due process, illegal search and seizure, and unlawful taking of property.

On January 31, 1984, the court (Gilmore, J.) entered an interlocutory order enjoining the enforcement of the VEIP in Carroll County. On appeal, we vacated the interlocutory injunction and remanded the case to the lower court for further proceedings. We held that: the VEIP’s tailpipe tests did not constitute a search and seizure within the meaning of the fourth amendment; that the inclusion of Carroll County and the exclusion of other rural counties in the VEIP was not a violation of equal protection because Carroll County was part of a “nonattainment area” for ozone; that COMAR § 11.14.06.05 exempting certain classes of vehicles from the program did not violate equal protection because a rational basis existed for the exemptions; that the VEIP provided adequate procedures to safeguard procedural due process interests of vehicle owners; that the suspension or revoca ⁷¹ tion of vehicle registration under the program was not a taking in violation of either the State or the Federal Constitution; that Carroll County’s inclusion in the VEIP was not a violation of substantive due process; and that the MVA had implicit authority to amend the regulations implementing the inspection program. Department of Transportation v. Armacost, 299 Md. 392 , 474 A.2d 191 (1984) (Armacost I).

Upon remand, the circuit court (Gilmore, J.), ruling on the parties’ cross-motions for summary judgment, held that § 23-202 and § 23-207 of the Transportation Article constituted an unlawful delegation of power from the legislature to an administrative agency in violation of Article 8 of the Maryland Declaration of Rights. Specifically, the court concluded that § 23-202 did no more than require the MVA to publish rules and regulations “to the extent required by federal law” and to establish an inspection system within Maryland. Further, the court stated that while § 23-207 requires that the rules and regulations adopted by the MVA be “consistent with federal law,” the statute did not “set forth sufficient guidelines for the MVA to determine what persons, vehicles, and geographic areas should be included in the program.” The court said that the powers vested in the MVA to make rules and regulations did not permit it to make laws. Thus, the court said, “in applying the program only to the Baltimore and Washington Metropolitan Regions, and not to the State as a whole, as provided for in § 23-202(b), the MVA restricted the Act being administered and, in doing so, legislated.” It concluded that “the delegation of power by the Legislature was too broad and failed to provide adequate guidelines and thus ... was unconstitutional and the statutes and regulations in question are invalid.” Judge Gilmore granted summary judgment for the appellees, and the State appealed to the Court of Special Appeals. 7 We granted certiorari prior to argument in the ⁷² intermediate appellate court to consider the important issue raised in the case.

Ill Our cases have long sanctioned delegations of legislative power to administrative officials where sufficient safeguards are legislatively provided for the guidance of the agency in its administration of the statute. See, e.g., Sullivan v. Bd. of License Comm’rs, 293 Md. 113, 121 , 442 A.2d 558 (1982); Governor v. Exxon Corp., 279 Md. 410 , 370 A.2d 1102 (1977), aff'd, 437 U.S. 117 , 98 S.Ct. 2207 , 57 L.Ed.2d 91 (1978); County Council v. Investors Funding, 270 Md. 403, 442 , 312 A.2d 225 (1973). As these cases indicate, the statutory guidelines serve not only to reduce the possibility of an arbitrary exercise of administrative discretion but also assist a reviewing court in determining the validity of agency action. The trend of the cases, as we pointed out in Investors Funding, supra, 270 Md. at 442 , 312 A.2d 225 “is toward greater liberality in permitting grants of discretion to administrative officials, particularly in the fields of public health and safety, in order to facilitate the administration of the laws as the complexity of governmental and economic conditions increase.” Consistent with this view, we have upheld broad delegations of legislative power to administrative agencies in numerous case.

See, e.g., Sullivan, supra, 293 Md. at 123 , 442 A.2d 558 (authorizing the adoption of rules and regulations by a liquor licensing board as may be necessary “to effectively administer the law and to foster and promote temperance”); Governor v. Exxon Corp., supra, 279 Md. at 415 , 370 A.2d 1102 (statute authorizing the Comptroller of the Treasury to adopt “ ‘rules or regulations defining the circumstances in which a producer or refiner temporarily may operate a previously dealer-operated station,’ ” and to permit “ ‘reasonable exceptions to the divestiture dates,’ ” by which producers or refiners of petroleum products are required to divest themselves of ownership of retail service stations in the State); Montgomery County v. Walsh, 274 Md. 502 , ⁷³ 523, 336 A.2d 97 (1975) (statute authorizing the County Executive to adopt “ ‘reasonable and necessary rules and regulations’ ” for the implementation of the Montgomery County Financial Disclosure Ordinance which required the filing of such financial disclosure statements “ ‘as might be desirable to promote the trust and confidence of the citizens of the County in the ... County government’ ”); Davis v. Montgomery County, 267 Md. 456, 464 , 298 A.2d 178 (1972) (statute authorizing boards of trustees of community colleges to adopt “ ‘reasonable rules, bylaws or regulations’ ” to effectuate and carry out the provisions of the statute relating to the establishment and maintenance of community colleges); McBriety v. Baltimore City, 219 Md. 223, 238 , 148 A.2d 408, 418 (1959) (statute authorizing the building inspection engineer, the commissioner of health, and the chief of the fire department to adopt rules and regulations “proper and necessary” to enforce multiple-family dwelling ordinance for the protection of the public interest); Givner v. Commissioner of Health, 207 Md. 184, 187-88 , 113 A.2d 899 (1955) (statute authorizing commissioner of health to adopt rules and regulations “proper and necessary” for the enforcement of a health ordinance pertaining to bathing facilities in dwelling units). In concluding that broad delegations of legislative authority to administrative agencies is particularly appropriate in the areas of public health and safety, we explained in Givner, supra, 207 Md. at 191 , 113 A.2d 899 : “In the field of public health, still more flexible standards are permitted. The concept of public health is more definite than that of general welfare, and there is a practical necessity for expert interpretation in its application to concrete situations.” See also Med.

Discipline v. Stillman, 291 Md. 390, 414 , 435 A.2d 747 (1981); Petrushansky v. State, 182 Md. 164, 174 , 32 A.2d 696 (1943); Tighe v. Osborne, 150 Md. 452, 460-61 , 133 A. 465 (1926). We have also relaxed the general rule that a statute vesting discretion in administrative officials ⁷⁴ without fixing any standards for their guidance is an unconstitutional delegation of legislative power “where the discretion to be exercised relates to police regulations for the protection of public morals, health, safety, or general welfare, and it is impracticable to fix standards without destroying the flexibility necessary to enable the administrative officials to carry out the legislative will, legislation delegating such discretion without such restrictions may be valid.” Pressman v. Barnes, 209 Md. 544, 555 , 121 A.2d 816 (1956). In certain circumstances, the expert assistance afforded by administrative agencies is so important to public health that we have found implied limitations on agency discretion when none has been expressed in the statutory language. See Truitt v. Board of Public Works, 243 Md. 375, 391 , 221 A.2d 370 (1966).

In this regard, “it is manifestly impractical for the legislature to set specific guidelines to govern the day-to-day exercise of the rule-making power.” Sullivan, supra, 293 Md. at 122-23 , 435 A.2d 747 . Of course, agency rules and regulations must be reasonable and consistent with the letter and spirit of the law under which the agency acts. Baltimore v. William E. Koons, Inc., 270 Md. 231 , 310 A.2d 813 (1973); Comptroller v. Rockhill, Inc., 205 Md. 226 , 107 A.2d 93 (1954). 8 ⁷⁵ The State maintains that the delegation of authority to the MVA and to the Department of Health and Mental Hygiene under the statutes, and particularly §§ 23-202 and 23-207, contains sufficient specific directives to the agencies and is therefore valid and constitutional. It says that the MVA, under the VEIP legislation, is required to comply with clearly articulated legislative standards in the administration of the emissions inspection program.

The State argues that both §§ 23-202 and 23-207, in express terms, incorporate the detailed standards imposed by the Clean Air Act and its regulations and therefore contain constitutionally sufficient limitations upon the discretion vested in the administrative agencies in bringing the State’s nonattainment areas into compliance with the national ambient air quality standards set by the EPA. According to the State, the “touchstone” of the VEIP is the Federal Clean Air Act and its regulations; it is the federal law which furnishes the context for interpreting the VEIP legislation. The General Assembly, the State urges, made the fundamental policy decisions when it enacted the state law, leaving to the agencies the task of implementing those decisions. In particular, the State invites attention to the Preamble to ch. ⁷⁶ 492 of the Acts of 1982 in which the General Assembly recited its purpose “to pursue, in good faith, the attainment of the ambient air quality standards established by the U.S. Environmental Protection Agency.” The State contends that the Legislature may, and did, embrace federal' standards in directing its administrative agencies to adopt rules and regulations in compliance with the federal requirements.

As the federal law requires only that the VEIP be established in the State’s two nonattainment regions, the State says that the MVA properly so limited the program’s scope in accordance with the statutory policy prescribed by the Legislature. In support of the circuit court’s holding, the appellees argue that the VEIP does not incorporate the detailed standards imposed by the Clean Air Act, nor does it impose specific federal rules by adopting them as state law. They suggest that the sole legislative standard provided by the VEIP pertains to goals in the federal statute, which by its very terms requires that the choices be made only by the states. They claim that the federal law affords broad latitude to the states in determining the contents of their plan and specifically provides that the SIP specify the manner in which national primary and secondary ambient air quality standards will be achieved and maintained.

The appellees argue that in enacting the VEIP legislation, the Legislature “made no policy decisions” and gave “no legislative directives, policies or standards to guide the MVA.” As a consequence, it is argued that “all the key decisions involving the scope of the VEIP were made by the MVA” in violation of the delegation doctrine and Article 8 of the Declaration of Rights. Those key decisions, according to appellees, included (1) the relationship between stationary and vehicular emissions; (2) the designation of the counties which would be part of the VEIP; (3) the permissible level of pollutants from each vehicle or class of vehicles; (4) the types of vehicles excluded from the program; and (5) how ⁷⁷ long a vehicle has to be tested. As to these, the appellees suggest that the MYA was given complete freedom to design any program it wished to implement and thus the discretion vested in the agency was wholly unchanneled. The appellees agree that the constitutional test, under the delegation doctrine, is whether the General Assembly provided sufficient legislative guidelines to limit adequately the exercise of discretion by administrative officials.

The appellees suggest that the delegation doctrine “has been infused with renewed vitality in recent years,” and they rely in particular on a spate of late Supreme Court separation of powers cases in support of this view. 9 In light of these cases, they maintain that even if the MVA regulations contain provisions for the protection of public health, nevertheless the current governing law would not find it impracticable for the Legislature to establish standards without destroying the flexibility needed by administrative officials in administering a vehicle