The opinion
SENTELLE, Circuit Judge,
dissenting:
While I agree with much of what the majority has to say, ultimately I would reach a different result for somewhat different reasons. I will not bother to rehash the facts well stated by the majority, but instead, I must say that I find the Secretary’s blatant use of 1998 losses to disburse funds appropriated by Congress “for economic losses incurred during 1999” unworthy of the elaborate defense offered by the majority. As the majority recognizes, the Secretary is empowered “to compensate producers for economic losses incurred during 1999.” 2000 Appropriations Act § 805. The Secretary advanced a formula compensating dairy farmers for production during 1997 or 1998. I would not defer to that decision. Granted, Chevron U.S.A. Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837 , 104 S.Ct. 2778 , 81 L.Ed.2d 694 (1984), requires us to defer in appropriate cases to an agency’s choice “based on a permissible construction of the statute.” Id. at 843 , 104 S.Ct. at 2782 . *757 However, that deference is called down only when “the statute is silent or ambiguous with respect to the specific issue.” Id. I find no ambiguity in the term “1999” that would permit it to be construed as meaning “1998.” I therefore would get off at the first step of Chevron: “If the intent of Congress is clear, that is the end of the matter; for the court, as well as the agency, must give effect to the unambiguously expressed intent of Congress.” Id. at 842-43 , 104 S.Ct. at 2781-82 .
By way of examples of the operation of the Secretary’s complex departure from an unambiguous congressional instruction, if a milk producer operated a dairy in 1997 and through the first week of October in 1998, and thereupon ceased production, he would have incurred no loss in 1999. Under the unambiguous instruction of Congress, he would be entitled to no compensation from the fund at issue. Under the Secretary’s application, he would receive compensation based on his production in 1997. Another producer, having suffered difficulties in 1997 and 1998 resulting in reduced milk production but having restored her herd to full producing potential in 1999, would likely have suffered compensable losses in 1999, given the market situation data relied upon by the Secretary. However, any compensation she received would be based not upon her 1999 losses, but upon a figure derived from a presumptive loss incurred based on her 1997 and 1998 reduced milk production, and presumably a lower figure than that to which she would be entitled for 1999. The Secretary admits that this methodology will admit into the pool of eligible applicants for a limited fund some number of dairy producers who no longer produced milk in the calendar year stated in the statute. Given that it is a fixed and limited fund, this inevitably reduces the amount available for distribution to producers eligible under the statutory criterion.
The majority accepts as a reasonable explanation the elaborate interpretation that using 1997 or 1998 levels of production to determine payments was really an efficient method of paying for losses in 1999. Assuming without conceding the reasonableness of the explanation proffered, I would reject it in any event. The analysis finds little basis in the administrative record, but is largely a product of the appellate brief cited by the majority in support of the reasonableness of the explanation. “We do not generally give credence to such post hoc rationalizations, but rather ‘consider only the regulatory rationale actually offered by the agency during the development of the regulation.’ ” Gerber v. Norton, 294 F.3d 173, 184 (D.C.Cir.2002) (quoting Grand Canyon Air Tour Coalition v. FAA, 154 F.3d 455, 469 (D.C.Cir.1998)). I would apply our normal rule and reject the post hoe explanation advanced by the Secretary’s appellate counsel and refined by the majority today.
Having determined that I would reject the Secretary’s compensation scheme, I, like the majority, am left with the question of what remedy is then appropriate. Once again I part company with the majority. I would not simply remand, but would vacate. In my view, “[o]nce a reviewing court determines that the agency has not adequately explained its decision, the Administrative Procedure Act requires the court — in the absence of any contrary statute — to vacate the agency’s action.” Checkosky v. SEC, 23 F.3d 452 , 491 (D.C.Cir.1994) (Randolph, J., concurring). As Judge Randolph noted in his opinion in Checkosky, the APA states as much “in the clearest possible terms. [The Act] provides that a ‘reviewing court’ faced with an arbitrary and capricious decision ‘shall ... hold unlawful and set aside’ the agency action.” Id. (quoting 5 U.S.C. § 706 (2)(A)).
*758 Granted, cases such as County of Los Angeles v. Shalala, 192 F.3d 1005 (D.C.Cir.1999), provide precedent for the authority of the court to remand without vacating, as the majority holds today. Nonetheless, even if we are empowered to depart from the literal command of the language — a proposition which in the absence of such precedent I would find surprising — I think it often, if not ordinarily, unwise. Heckler v. Chaney, 470 U.S. 821 , 105 S.Ct. 1649 , 84 L.Ed.2d 714 (1985), among many other cases, establishes the proposition that courts are not to substitute their administrative judgments for those of the agency. Any time that the agency has not adequately justified its decision, we do not know what the agency’s decision would have been had it subjected the questions before it to the lawful administrative process. Therefore, when we hold that the conclusion heretofore improperly reached should remain in effect, we are substituting our decision of an appropriate resolution for that of the agency to whom the proposition was legislatively entrusted. I therefore cannot concur.
For a similar reason, I would vacate not only the use of the wrong annual losses for the determination of the amount of relief offered, but the regulation in its entirety, including the limitation of compensation to 26,000 cwt of production. Granted, the Secretary and the majority make out a good case for the unreviewability of that element of decision. Had that question come to us unaccompanied by the primary issue upon which I would vacate, I likely would have joined the majority’s decision that it is unreviewable. But, as the Supreme Court reminded us in Heckler v. Chaney, as relied upon by the majority, the decisions of the agency involve a “ ‘complicated balancing of a number of factors which are peculiarly within [an agency’s] expertise.’ ” Maj. Op. at 751 (quoting Heckler v. Chaney, 470 U.S. at 831 , 105 S.Ct. at 1655 ). Since I would vacate the unauthorized year, I am unable to ascertain whether the agency would have employed the same production cap had it used the right production year, and therefore I would be left with no choice but to remand this case to the district court for an order vacating the Secretary’s decision and remanding the matter to the Secretary for further proceedings applying the correct statutory allocation.
Although I greatly respect the majority’s attempt to save a well-intended relief program from possibly inefficient further proceedings, I do not think we can lawfully do so. I therefore most respectfully dissent.