Judicial Review of Agency Benefit-Cost Analysis

Editor’s Note: Benefit-cost analyses relied on by agencies in rulemakings must comply with the requirements of the Data Quality Act.

From: George Mason Law Review, 2015

Caroline Cecot & W. Kip Viscusi


[W]hen an agency decides to rely on a cost-benefit analysis as part of its rulemaking, a serious flaw undermining that analysis can render the rule unreasonable.1

However, we would be reluctant to seize upon a single apparently erroneous datum in a very complex rulemaking and announce that the error undermines the entire rule . . . .2



This Article has evaluated how courts review agency BCAs. It has discussed the  conditions  that trigger judicial  review  of  agency  BCAs  and  the standards that govern the review. Against this backdrop, it presented specific  examples  of  how  courts  analyze  BCAs. It found  that  courts  are  most comfortable  evaluating  BCAs  in  light  of  statutory  guidance.  That  said, courts  have  been  willing  to  question  BCA  methodology  and  assumptions, and request more transparency on these issues. In addition, BCAs prepared pursuant to executive order can be used against the agency in certain situations, even if the agency does not and need not rely on the BCA. The performance  of  the  courts  has  been  sufficiently  competent  that  entrusting greater  responsibility  to  courts  may  be  beneficial. There  is no  evidence  of courts overstepping their proper scope of authority in this area. [Emphasis added]

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