502 F.2d 306 (3rd Cir. 1974), 73-1914, Paac v. Rizzo

Docket Nº:73-1914.
Citation:502 F.2d 306
Party Name:PAAC as a Commission and Individually et al. v. Frank L. RIZZO, Mayor of the City of Philadelphia and as an individual, et al.(D.C. Civil No. 73-957) CITY OF PHILADELPHIA v. Melvin L. HARDY and Isaiah Crippins. (D.C. Civil No. 73-990)
Case Date:June 14, 1974
Court:United States Courts of Appeals, Court of Appeals for the Third Circuit

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502 F.2d 306 (3rd Cir. 1974)

PAAC as a Commission and Individually et al.


Frank L. RIZZO, Mayor of the City of Philadelphia and as an

individual, et al.(D.C. Civil No. 73-957)



Melvin L. HARDY and Isaiah Crippins. (D.C. Civil No. 73-990)

No. 73-1914.

United States Court of Appeals, Third Circuit

June 14, 1974

Argued April 2, 1974.

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[Copyrighted Material Omitted]

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Donald E. Matusow, S. Gerald Litvin, Philadelphia, Pa., for appellants PAAC and Melvin Hardy.

John Mattioni, Deputy City Solicitor, Martin Weinberg, City Solicitor, Philadelphia, Pa., for appellees.

Before VAN DUSEN, WEIS and GARTH, Circuit Judges.


We are called upon to resolve a conflict between the Mayor of Philadelphia, the Honorable Frank Rizzo, and the Philadelphia Anti-Poverty Action Commission ('PAAC'). For reasons other than those articulated by the district court, 1 we conclude that it was proper for the court to refuse the relief sought against Mayor Rizzo.

Melvin Hardy (a former Executive Director of PAAC), Isaiah Crippins (a former General Counsel of PAAC), and PAAC commenced this action in the District Court for the Eastern District of Pennsylvania on April 27, 1973. Their complaint includes a variety of claims concerning the alleged interference of Mayor Rizzo with the functioning of the anti-poverty agency. By far the most prominent of these claims is the charge that the Mayor violated federal law by removing Melvin Hardy as the Executive Director of PAAC and by refusing to renew Mr. Crippins' contract as General Counsel. Less precise, but still present in the complaint, are charges that: (1) the Mayor illegally blocked appointments to PAAC made by its Executive Director; (2) the Mayor appointed persons to the PAAC Board illegally; (3) the Mayor convened PAAC meetings illegally; and (4) the Mayor defamed each of the plaintiffs. The complaint seeks declaratory and injunctive relief, as well as compensatory and punitive damages.

Four days after the above action was commenced, the City of Philadelphia instituted an action in state court against Hardy and Crippins, seeking to restrain the defendants from exercising their duties as Executive Director and General Counsel of PAAC. 2 On May 3, 1973, Melvin Hardy and Isaiah Crippins removed the City's action to the District Court for the Eastern District of Pennsylvania, pursuant to 28 U.S.C. 1441. Perceiving a close similarity between the two actions, the district court then consolidated the original action brought by PAAC, Hardy and Crippins (District Court No. 73-957) with the City's removed action (District Court No. 73-990). On May 10, 1973, the court conducted a one day hearing on the merits of the consolidated case.

After the hearing, the City moved for dismissal of No. 73-957 and for remand of No. 73-990 on the grounds of lack of subject matter jurisdiction.

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These motions were denied sub silentio by the district court. In a memorandum opinion, the district court found that:

(1) subject matter jurisdiction exists (pursuant to 28 U.S.C. 1331) for the district court to consider all matters raised in the consolidated actions; and

(2) federal law permits the Mayor to remove PAAC's Executive Director and to refuse to renew the contract of PAAC's General Counsel.

With regard to the peripheral matters raised in PAAC's original complaint, the Court stated:

We have not considered the myriad of other allegations and issues raised in the pleadings for the following reasons: (a) no evidence was presented at the hearing in connection therewith; (b) these matters were not briefed by the parties; and (c) in view of the issues decided herein, the other allegations and issues raised in the pleadings now appear moot.

Judgment was thereupon entered in favor of the defendants in No. 73-957 and in favor of the plaintiff in No. 73-990. PAAC and Hardy appeal pursuant to 28 U.S.C. 1291. 3

I. Background

To understand the district court's primary conclusions, it is necessary to trace briefly the history of relevant anti-poverty legislation. As part of the Economic Opportunity Act of 1964, Congress established a Community Action Program. This Program encouraged the development of local agencies to provide multiple services to impoverished communities. Originally, the Program envisioned as a goal the 'maximum feasible' participation of the poor in the development of Community Action Programs. By 1967, however, Congress recognized that the Community Action Program could not succeed without the support of locally elected officials. See 1967 U.S. Code, Congressional & Administrative News at 2448-49 (excerpted from House Report No. 866, 90th Cong., 1st Sess. 1967).

On December 23, 1967, Congress enacted the Green Amendments to the Economic Opportunity Act of 1964. These Amendments gave flexibility to the Community Action Program, permitting localities a choice in the type of 'community action agency' that would qualify for federal funding. Under the Green Amendments, the agency may either be a 'State or political subdivision of a State (having elected or duly appointed governing officials), or a combination of such political subdivisions' or it may be a 'public or private non-profit agency or organization which has been designated by a State or such a political subdivision or combination of such subdivisions.' 42 U.S.C. 2790(a). The former administers its program through a community action board, 4 while the latter administers its program through a governing board. 42 U.S.C. 2791(a). 5

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The Economic Opportunity Act is somewhat imprecise with regard to the distinctions between the two types of boards. A governing board has the power to 'appoint persons to senior staff positions, to determine major personnel, fiscal, and program policies, to approve overall program plans and priorities, and to assure compliance with conditions of and approve proposals for financial assistance under this subchapter.' 42 U.S.C. 2791(e). The parallel powers of a community action board, on the other hand, are not made explicit by the statute. The Office of Economic Opportunity, however, has explained that in jurisdictions with community action boards, the 'governing officials' 6 will exercise the same powers that governing boards exercise, unless the officials delegate these powers to the community action boards. OEO Community Action Program Memorandum No. 81 at 5.

In determining whether PAAC or Mayor Rizzo had the authority to remove Hardy, the district court focused upon the fact that the appointive powers of community action agencies differ, depending upon whether the agency is administered by a governing board (lodging the appointive powers in the board itself) or by a community action board (lodging the appointive powers in governing officials). The court thus posed as determinative the issue as to whether PAAC 'is a political subdivision of the City of Philadelphia administered by a 'community action board' or whether it is a public or private non-private agency administered by a 'governing board."

To resolve this issue, the district court examined the history of the Philadephia Anti-Poverty Action Commission. As the court found, PAAC was on February 22, 1965 by the Executive Order of former Mayor James H. Tate. 7 According to the uncontradicted testimony of appellant's witnesses, PAAC was (from 1965 to 1967) the only community action institution in the country that existed solely by virtue of an Executive Order. To mollify demands from Washington, a blue ribbon panel was formed to develop permanent legislation. As a result of the panel's efforts, the Philadelphia City Council adopted Bill No. 2846 on December 27, 1967. This Ordinance, appearing as Title 21-800 of the Philadelphia Code, provides, in pertinent part, that:

(1) Creation of Commission. The Philadelphia Anti-Poverty Action Commission is hereby created. It shall be composed of an uneven number of members, not less than 31 nor more than 45 in number. All of the members of the Commission shall serve without compensation. The initial number of members of the Commission shall be 38 members and there shall be no change in the number of members of the Commission at any time unless two-thirds of the members appointed to the Board approve the change in membership. The members of the Commission shall select a chairman from among themselves. The term for which any member of the Commission shall serve shall be for a period of one year and until their successors are appointed and qualify.

(2) Appointment of Members. The Members of the Commission shall be appointed by the Mayor. (The ordinance then recommends that the Mayor

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appoint specific officials as members.)

(3) The Mayor shall select an Executive Director from among a panel of 3 persons whose names are submitted to the Mayor by the Commission. The Mayor shall be at liberty to request the Commission to present to the Mayor additional panels of 3 persons from which he may select an Executive Director. The request of the Mayor for additional panels shall not preclude him from selecting a name from among the prior panels.

(5) Powers and Duties. The Commission shall have the following powers and duties:

(a) To conduct, administer and coordinate Federal anti-poverty programs in Philadelphia;

(b) To mobilize the resources of the City of Philadelphia and its residents to combat poverty through a community action program;

(c) To mobilize and utilize resources, public and private, in an attack on poverty;

(d) To provide services, assistance and other activities of sufficient scope and size to give promise of progress through...

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