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| Minnesota's OAH:
January
1, 2006, marked a significant anniversary for Minnesota’s legal system.
As of that date, the Office of Administrative Hearings (OAH)
completed 30 years of service to Minnesotans. In January of 1976,
when Wendell Anderson was governor, Robert J. Sheran was chief justice
of the Minnesota Supreme Court, and Butch Wynegar was an All-Star
for the Minnesota Twins, the Office of Hearing Examiners began with
Duane Harves as its first chief hearing examiner.1
Since then, use of the administrative process as a method of
dispute resolution has grown significantly, and much of the growth
that has occurred in Minnesota has become a model for other states. Minnesota is nationally recognized for its “good government” innovations in
many areas, and administrative law is one of them. In the mid-1970s, Minnesota was a trendsetter
in establishing a neutral forum for adjudication of administrative
disputes. In the succeeding
three decades, the state has continued to play a prominent role in
expanding the range of possibilities for resolving conflicts between
citizens, state agencies and political subdivisions through administrative
proceedings. Hand in hand with innovations in the use of
the administrative process, the Legislature has repeatedly emphasized
its expectation of quality, accountability, and professionalism in
the services that OAH performs. That expectation has also
been a further catalyst for innovation. The Central Panel Concept Prior to the 1970s, most state
agencies throughout the country employed their own hearing officers
to conduct the due process hearings that agencies were constitutionally
or statutorily required to provide for members of the public.
Minnesota was no exception.
Each individual agency conducted its own hearings and conducted
them in its own way. There was little consistency of process from
one agency to another, with some agencies having formal rules governing
the hearing process while others simply proceeded by custom. Similarly, there was little
uniformity in the qualifications of the individuals holding the hearings.
Some agencies were authorized by statute to employ their own hearing
officers.2 Others were precluded from using their own employees
but were authorized to contract with private individuals to preside
over hearings.3 Concerns began
to be raised about the apparent lack of impartiality in the hearing
process, specifically about the unfairness inherent in having a person
employed by an agency conduct hearings to determine the propriety
of that agency’s actions. As legislatures added to the number of situations
requiring a due process hearing, this agency-centric system became
less and less workable. In the mid-1970s, the Minnesota Legislature
was one of a handful of state legislatures that was struggling with
these administrative hearing concerns. At the same time, concerns
were also being raised in Minnesota about agency rulemaking processes. One cause was the statutory definition of “rule”
in early versions of the Minnesota Administrative Procedures Act. It was ambiguous, and it appeared that agencies
were taking advantage of the ambiguities to avoid formal rulemaking.
The Legislature increasingly felt that state agencies were
engaging in “informal rulemaking” — that is, basing regulatory actions
on statements of policy that were not subjected to any formal process.4
The Legislature was also becoming frustrated by the lack of
consistency in the rulemaking practices of the 75 or so state agencies
that were promulgating rules. All of these issues came to a head in the 1974
and 1975 sessions of the Legislature, when committees in both chambers
conducted thorough reviews of existing rulemaking processes. In 1946, California had experimented
with the administrative process by creating a “central panel” administrative
hearing office. Central panels
are independent agencies, usually in a state’s Executive Branch, not
affiliated with any other state agency and whose sole function is
to provide administrative hearing services for other state agencies.
Since central panel hearing officers are not employees of the
agency whose actions are being contested, the members of the public
are assured of a neutral and impartial forum for resolution of disputes
with state agencies. When the Minnesota Legislature decided to reform
the administrative process in the mid-1970s, it chose, along with
three other states,5 to adopt the central panel concept. What previously
had been an experiment became a trend.
Today, 27 states have some form of central panel as do several
Canadian provinces. Combining Independence and Professionalism In 1975, the Minnesota Legislature
addressed the issues of impartiality, consistency, and accountability
by creating an independent central panel hearing office to conduct
administrative proceedings. The
new Office of Hearing Examiners was given an oversight role in the
rulemaking process and was empowered to conduct many of the due process
hearings that the state agencies were required to conduct.6
There were some significant exceptions, however, particularly
with respect to high-volume hearing functions.
Although implied consent drivers’ license revocation hearings
were administrative in nature, they had been handled in the state
court system, and that practice continued after the Office of Hearing
Examiners was established. Additionally, welfare benefit hearings, unemployment
compensation hearings, and workers’ compensation benefit hearings
continued to be conducted by employees of the state agencies that
were responsible for those programs. The legislation creating Minnesota’s
central panel indicated that the Legislature wanted to ensure independence
and professionalism in the newly created hearing office. The chief hearing examiner was to be appointed
by the governor with the advice and consent of the Senate. To assure independence and to minimize potential
politicization of the position, the chief was given a term of six
years — two years longer than the governor’s term of four years. The legislation also contained an explicit requirement
that hearing examiners “be free of any political or economic association
that would impair their ability to function officially in a fair and
objective manner.”7 Additionally,
the Legislature addressed the issue of professional competence by
requiring that all hearing examiners “have demonstrated knowledge
of administrative procedures.”8 The enabling legislation also
provided that “[i]n assigning hearing examiners to conduct such hearings,
the chief hearing examiner shall attempt to utilize personnel having
expertise in the subject to be dealt with in the hearing.”9
This was in accord with the longstanding view that administrative
issues are often complex and highly technical, and therefore require
adjudicators with commensurate special expertise.
Accordingly, the new chief hearing examiner made an effort
to fill the hearing officer positions with persons having experience
in a variety of areas of administrative law in order to comply with
the Legislature’s expectations. Subsequently, as the range
of hearings that OAH
conducted grew and more cases were filed, a strict separation of case
assignment by area of specialization became problematic. Ultimately,
overcrowded dockets and fewer hearing officers made it necessary to
assign cases outside of narrow specialty areas.
In an effort to respond to the Legislature’s concern about
expertise, the OAH now
cross-trains judges to ensure that there is more than one judge that
is familiar with each type of subject matter.
This has had an added benefit in that judges enjoy the variety
and have actively worked to acquire expertise in multiple areas of
administrative law. In turn,
this has fostered a stronger sense of unity, collegiality, and mutual
supportiveness that has enhanced the professional standing of the
organization as a whole. OAH
has also been mindful of the Legislature’s expectations of high ethical
standards and professionalism. Although
the initial legislation creating the agency did not include statutory
standards of ethical conduct, the OAH
subsequently proposed that its judges be bound by the same provisions
of the Code of Judicial Conduct that apply to other judges in the
Executive and Judicial branches. The Legislature amended the enabling
legislation in 2000, and the Code of Judicial Conduct now applies
to all administrative law judges and workers’ compensation judges. Range of Services Over the years, the Legislature
has sought to resolve various kinds of disputes
and provide timely due process for Minnesota’s citizens by giving
OAH additional hearing responsibilities.
Because OAH is an independent state agency, and not under the
control of any other agency, it has been in a unique position to implement
the Legislature’s efforts to provide consistent due process, to expedite
resolution of administrative issues, and to provide a resource for
cities, counties and townships. The first significant expansion
of OAH responsibilities after its creation
was in 1981, when legislation transferred all workers’ compensation
hearing functions and the compensation judges who were performing
those functions from the Department of Labor and Industry to the now
renamed Office of Administrative Hearings.10 While OAH
took on this high-volume caseload, the Department of Labor and Industry
retained, for the time, the alternative dispute resolution functions
and the quasijudicial settlement function. The Department of Labor
and Industry continued to employ a cadre of compensation judges, known
as “settlement judges,” who presided over settlement conferences and
certain other related prehearing proceedings. The two quasijudicial
functions continued to be done in the two different state agencies
until 1997, when the Legislature created a Settlement Division within
OAH and transferred all
of the settlement functions to OAH,
along with the settlement judges who had been performing those functions. Since that transfer of responsibility,
the rulemaking/due process hearing function and the compensation hearing
function have become separate operating divisions within the OAH. Each
division is supervised by an assistant chief judge. Scheduling issues make it difficult for judges
to regularly handle cases in both divisions; however, such crossover
is permitted by statute. Child Support Cases In addition to workers’ compensation,
the 1980s saw further expansion of the OAH jurisdiction, this time
in response to congressional directives.
In 1984 Congress required all states to create expedited procedures
for dealing with child support orders involving persons on public
assistance. In 1987 the Minnesota Legislature saw OAH as
an efficient and responsible answer to that challenge. It directed
OAH to create an administrative process for establishing child support
obligations for welfare benefit recipients.
The program enabled child support orders to be issued or modified
by administrative law judges, rather than district court judges.
By 1998 OAH was performing that function in all of Minnesota’s
87 counties. The state legislation
went too far, however, in the breadth of powers it gave to administrative
law judges. For example, the
state legislation gave administrative law judges all of the powers,
duties, and responsibilities conferred on district court judges for
these cases, including the power to issue subpoenas and issue warrants
for failures to appear. Administrative law judges were also given full
authority to modify previously issued child support orders, including
those issued by district court judges.
OAH’s
involvement with child support orders came to an abrupt end in January
1999, when the Minnesota Supreme Court held that OAH’s
administrative child support hearing process amounted to an unconstitutional
delegation of judicial power to an Executive Branch agency.11 That spring, legislation was enacted transferring
that function back to the state court system. Campaign
Complaint Cases OAH
responded again to the changing needs of the state in time for the
2004 elections. Prior to 2004,
Minnesota’s county attorney offices were obligated to investigate
alleged violations of the state’s fair campaign practices and financial
reporting requirements. This often meant initiating grand jury proceedings
and bringing criminal prosecutions when violations appeared to be
substantiated. This used significant amounts of county attorney time
and resources. Many complaints involved relatively minor or technical
infractions, and some were simply frivolous and filed as a campaign
tactic. Often, these complaints could not be investigated before the
related election was held. The county attorneys and the Legislature
were looking for a faster and more economical method for hearing these
complaints and sorting out the most serious for criminal prosecution.
In 2004 the Legislature recognized
the need for faster resolution of campaign complaints by creating
civil remedies and an administrative process for potential campaign
violations. Beginning on July 1, 2004, all complaints of alleged violations
of state statutes regulating campaigns for public office must be filed
with the OAH, rather than with county attorneys. The legislative change provided that those complaints
must be finally disposed of in administrative proceedings conducted
by OAH before they may
be the subject of criminal prosecution by county attorneys. This new approach to addressing
violations of election campaign laws is much more expeditious and
efficient than prior practice. There
is no need to convene a grand jury unless a case is referred by OAH
for criminal prosecution. Most hearings are held and decisions rendered
prior to rather than after the election. In the first two years after
jurisdiction came to OAH,
the number of complaints has dropped significantly and county attorney
resources have been redirected to other areas. Boundary Adjustment Unit By Reorganization Order No.
192, dated February 2, 2005, the governor transferred the functions,
powers, duties, and responsibility of the Department of Administration’s
Municipal Boundary Adjustment Unit to OAH.12
The Municipal Boundary Adjustment Unit administers the state’s
uniform system for city boundary adjustment, by exercising its quasijudicial
authority to issue administrative orders for the creation or dissolution
of cities or for the alteration of city borders through consolidation,
annexation, or detachment. Prior to the reorganization,
the Municipal Boundary Adjustment Unit had bounced from the Municipal
Board to the Office of Strategic and Long-Range Planning to the Department
of Administration. Morale was low, and the recognition of its important
functions was diminishing. Transfer of the unit to OAH
consolidated all of the administrative, alternative dispute resolution,
and hearing functions relating to municipal boundary adjustments. Combining all of those functions under a single
roof has resulted in improved communication, management attention
and focus. Services for Political Subdivisions The Legislature has also recognized
that the state’s political subdivisions are frequently required to
conduct their own adjudicative administrative hearings, such as liquor
license revocations. Multimember governing bodies, such as county
boards, city councils, and school boards often find it difficult to
conduct necessary quasijudicial hearings efficiently as a body and
to create records of those proceedings that facilitate later judicial
review. The hearings are, in many cases, not an efficient
use of time for entire boards or councils and require expertise in
legal issues that council or board members may lack. Another innovation that sets
Minnesota apart from most other states, including those with central
panels, is OAH’s statutory authority to contract with
local governments to have OAH’s
administrative law judges conduct local administrative hearings. Although
many county boards, city councils, and school boards still either
conduct their own administrative hearings or hire private attorneys
to conduct them, increasing numbers of political subdivisions have
been contracting with OAH for those services. OAH
currently conducts licensing hearings of various types, personnel
due process hearings, and a variety of other administrative hearings
for a large number of different political subdivisions.
Leader in Quality Minnesota’s OAH has also led
the way in designing systems for continuous improvement and performance
measurement of its judges and its internal operations. For example,
in 1998, Chief Judge Ken Nickolai began the Judicial Development Program
at OAH. The purpose of the program was to identify for judges the
things they are doing well and also to identify those aspects of their
performance that could be improved. This was accomplished through
surveys of attorneys and parties appearing before OAH judges. The
surveys asked key questions about how the judges performed in terms
of efficiency, fairness, knowledge of the law, and other factors.
The individual survey responses were kept confidential and the individual
results given to each judge. The judge then discussed the results
with a mentor, usually another judge, and set goals for self-improvement.
Those goals, and the judges’ success in achieving them, have become
part of the judges’ annual performance reviews. This program was repeated
in 2001 and is underway again this year. OAH’s
Judicial Development Program is unique in the U.S. and Canada. In
2001, it was a semifinalist for the Innovations in American Government
Award awarded by the Institute for Government Innovation at the John
F. Kennedy School of Government at Harvard University. This unique
approach to performance management for judges has attracted both national
and international attention and invitations to speak to interested
groups such as the National Association of Administrative Law Judges,
the Central Panel Directors’ Conference, and the British Columbia
Association of Administrative Tribunals. Several states with central panels have also
requested more detailed information and design assistance from OAH on this program as they attempt to
use it as a model for their own central panels. The office implemented another
approach to assessing the quality of judicial performance in the fall
of 2005. A survey was sent
to all the agencies, commissions, and boards that utilize OAH’s
rulemaking, mediation, or adjudication services. The survey asked
for feedback on responsiveness, cost, quality of work, and additional
services that would be helpful, such as mediation or training in rule
writing. The results of these surveys will be used for internal improvements
and as a basis for providing agencies with a more tailored approach
to meeting their needs. The goal is to create opportunities for better
service and lower costs for the various state agencies that utilize
those services. OAH has
plans to do a similar follow-up with local units of government that
contract with OAH for hearing services. The trend in the United States
since the early 1970s has clearly been toward creating central panels
as an efficient and impartial means of dealing with administrative
due process hearings and rulemaking.
Some states conduct a narrower range of hearings than Minnesota’s
OAH does, but many of
those are gaining that jurisdiction incrementally, as did Minnesota.
For example, North Carolina and Michigan acquired the rulemaking
oversight function in 2005. On the other hand, other state central panels
have much wider jurisdiction than Minnesota’s does. Typically, those central panels have jurisdiction
that includes unemployment compensation appeals and welfare benefit,
child support and corrections department due process hearings. Significantly,
in 33 states, implied consent hearings are handled administratively
rather than through the already overburdened judicial system. After 30 years, Minnesota can
take some justified satisfaction in the quality and continuing innovation
at OAH. There are many opportunities for improvement
and expansion of the critical services OAH provides, but if history is any indicator, the judges and
staff of OAH will be
up to the challenges and at the forefront. c Notes 2 See, e.g.,
1967 Minn. Laws ch. 864, §4 and 1969 Minn.
Laws ch. 1129, art. 4, §5. 3 See, e.g., 1973 Minn. Laws ch. 897, §20, 1969 Minn.
Laws ch. 975, §§11-13, and 1973 Minn. Laws ch. 688, §3. 4 In Thomas J. Triplett and James Nobles, “Rule-making
under Minnesota’s Administrative Procedure Act: 1975 Amendments,”
Hennepin Lawyer, Jul.-Aug. 1975
at 14, the authors, both of whom were serving as legislative staff,
list a number of fairly egregious examples of informal rulemaking
by agencies. See also
the discussion in Duane R. Harves,
The State of Minnesota Office of Administrative Hearings 1975
– 1985: A Report on the First Decade (1986)
at pp. 3-4. 5 Florida, Massachusetts,
and Tennessee 6 1975 Minn. Laws,
ch. 380. 7 1975 Minn. Laws
ch. 380, §16. 8 Id. 9 Minn. Stat.
§15.052, subd. 3 (1976). 10 1981 Minn.
Laws ch. 346. The title “hearing
officer” became “administrative law judge” to conform to this change. 11 Holmberg
v. Holmberg, 588 N.W.2d 720
(Minn. 1999). 12 Minn. Stat.
§16B.37, subd. 2, effective on March 9, 2005.
Raymond R. Krause is Chief Administrative Law Judge for the State of Minnesota. He previously held a position as a judge on the Minnesota Tax Court. |
