California Human Development Corp. v. Brock, 84-5321
| Citation | 762 F.2d 1044 |
| Decision Date | 28 May 1985 |
| Docket Number | No. 84-5321,84-5321 |
| Parties | CALIFORNIA HUMAN DEVELOPMENT CORPORATION, et al., Appellants, v. William E. BROCK, Secretary, Department of Labor. |
| Court | United States Courts of Appeals. United States Court of Appeals (District of Columbia) |
Appeal from the United States District Court for the District of Columbia (D.C.Civil Action 83-03008).
Noel H. Klores, Washington, D.C., with whom James L. Feldesman and Jacqueline C. Leifer, Washington, D.C., were on the brief, for appellants.
Michael Kimmel, Atty., Dept. of Justice, Washington, D.C., with whom Richard K. Willard, Acting Asst. Atty. Gen. and Joseph E. diGenova, U.S. Atty., Washington, D.C., were on the brief, for appellee.
James A. Peters, Asst. Atty. Gen., State of Florida, Tallahassee, Fla., was on the brief for amicus curiae urging remand.
Before MIKVA and SCALIA, Circuit Judges, and BAZELON, Senior Circuit Judge.
Opinion for the court filed by Senior Circuit Judge BAZELON.
Appellants challenge the Department of Labor's (DOL) method for allocating funds under section 402 of the Job Training Partnership Act (JTPA). 1 Under this statute, the DOL distributes grants among states to support programs servicing migrant and seasonal farmworkers. The district court, on summary judgment, upheld the DOL's formula for allocating funds. Because the DOL's method is reasonably consistent with its congressional mandate, the district court's decision is affirmed.
The appellants, grantees of farmworker training funds under the JTPA, contest the DOL's formula for distributing the funds among the states. These grantees are nonprofit organizations residing in states receiving reduced allocations in fiscal year 1984. 2 They claim that use of the challenged formula results in allocations inconsistent with the proportional number of eligible migrant and seasonal farmworkers in each state.
This controversy centers on how the DOL should annually distribute $57 million in farmworker training funds. 3 Here the total amount of the budget is not at issue. Instead, the parties dispute the method for distributing these extremely limited public funds among many needy programs. There are enough funds to service only one-tenth of the total eligible population. 4 Thus, no matter how the agency chooses to allocate its funds, only a fixed and small proportion of the eligible poor can be benefitted.
Under the Job Training Partnership Act, the DOL administers federal grant programs for the training and reemployment of low-income workers. Section 402 of JTPA provides the statutory basis for a particular program that makes federal grants to eligible public or private agencies for the purpose of providing job training, employment opportunities, and other services to migrant and seasonal farmworkers. In establishing this program, Congress found that "chronic seasonal unemployment and underemployment in the agricultural industry, aggravated by continual advancements in technology and mechanization resulting in displacement, constitute a substantial portion of the Nation's rural employment problem and substantially affect the entire national economy." 5
Under the predecessor statute to JTPA--the Comprehensive Employment Training Act (CETA) 6--the Secretary of Labor used 1977 Social Security industrial data in estimating the location and extent of the beneficiary farmworker population. 7 The DOL allocated federal funds in proportion to the estimated number of eligible beneficiaries in each state. The DOL calculated the total number of individuals in each state working in agriculturally-related industries with reported earnings of $3,000 or less 8 and for whom Social Security taxes are paid.
The data base for determining allocations was changed when the JTPA was enacted in 1982. 9 The JTPA mandated a switch in the data base, stating that: "All data relating to economically disadvantaged and low-income persons shall be based on 1980 Census or later data." 10 Furthermore, the legislation set forth procedures that the DOL must follow if the agency wished to rely upon a particular formula in its allocations:
Whenever the Secretary utilizes a formula to allot or allocate funds made available for distribution at the Secretary's discretion under this chapter, the Secretary shall, not later than 30 days prior to such allotment or allocation, publish such formula in the Federal Register for comments along with the rationale for the formula and the proposed amounts to be distributed to each State and area. After consideration of any comments received, the Secretary shall publish final allotments and allocations in the Federal Register. 11
The new legislation also established deadlines for dispersal of the federal funds to states. 12
Given the imposed time restraints, the Department was forced "to make complex decisions in a relatively short period of time." 13 The DOL sought to establish the allocation apparatus in time for the transition period October 1983 through June 1984 during which $43 million was allocated. In so doing, the DOL dutifully complied with the procedures outlined in the JTPA. 14 On August 12, 1983, the Department published for review and comment the proposed formula based on the 1980 Census data. 15 The DOL explained that "the proposed planning estimates are based on the total number of people in each State who worked in qualifying agricultural occupations and reported a poverty level income ...." 16
The DOL's regulations concerning the future application of the formula were effective October 1, 1983. The regulations provided that up to six percent of section 402 funds may be used for discretionary federal projects, 17 and that "[n]o less than 94 percent of the funds received for section 402 activities shall be allocated for farmworker programs in individual States in an equitable manner using the best data available as to the farmworker population as determined by the Department." 18 Recognizing that the congressionally-mandated shift in data bases could result in "disruption of funding levels from one year to the next," the DOL included a "hold harmless" provision limiting to twenty-five percent any reduction in a State's allotment from the prior year. 19
The regulations also included a definition of "farmwork" as "work performed for wages in agricultural production or agricultural services as defined in the most recent edition of the Standard Industrial Classification (SIC) Code definitions ...." 20 However, the regulations expressly provided that the definition is applicable only "for eligibility purposes," as distinguished from allocation purposes. Under the eligibility regulations, a low-income farmworker is eligible if at least fifty percent of his income or time during a specified twelve-month period was in farmwork; if he performed farmwork for wages; earned at least $400 performing farmwork, or performed farmwork for at least twenty-five days; and was employed on a seasonal basis, without a constant year-round salary. Dependents of these individuals are also eligible. 21
In December 1983, following review of public comments, specific allotments for each state were fixed for the transition period October 1983 through June 1984. The DOL further explained that "[t]he most recent available [Social Security] data are for 1977," and therefore it had to rely on the 1980 Census under the JTPA's "latest available data" requirement. 22 The DOL indicated that the Social Security data included persons in agriculturally-related industries. In contrast, the Census count--as relied upon by the DOL--used occupational classifications. The industrial classifications or codes, that were formerly used, "captured many non-farmworkers such as clerical, administrative, and technical employees of agricultural firms, and therefore vastly overstated the farmworker population." 23
In January 1984, the DOL announced the state allotments for program year July 1984 through June 1985. The same formula was used to distribute $57 million during this second time interval. Thus, the DOL acted expeditiously to meet statutory deadlines. However, the DOL had assured concerned parties that there would be "on-going review," so in subsequent years the best data available (as determined by the Secretary of Labor) would be used. 24 The DOL has employed an interagency task force to review the data base for the purpose of suggesting improvements and refinements. 25
In this suit, the appellants challenge the DOL's allocation of JTPA section 402 funds, alleging that: (1) the DOL violated its own regulations by failing to use the best data available and by failing to allocate funds equitably; (2) the DOL violated the JTPA by not providing a rationale for the formula and by not considering comments; and (3) the DOL's action was arbitrary and capricious.
After a period of discovery, the district court dismissed the suit on summary judgment. The district court concluded that the DOL arrived at an allocation formula based on factual data reasonably available to it, and that the Department's actions could not be characterized as arbitrary and capricious. 26 Because the DOL's shift in policy was mandated by Congress and because the Department did not violate its own regulations, the district court's decision is affirmed.
The DOL's actions in allocating JTPA section 402 funds must conform to relevant statutes and to the agency's own regulations. 27 The JTPA does not preclude judicial review. 28 Indeed, the statute expressly requires the Secretary of Labor to follow a carefully delineated process that includes providing a "rationale for the formula," 29 if it decides to use a formula.
In this case, the DOL substantially conformed to the JTPA's requirements and to the Department's own prescriptions. In evaluating the reasonableness of the agency's...
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