APPALACHIAN AGENCY FOR SR. CITIZENS v. Bland, Civ. A. No. 88-0123-B.

• Decision Date: 19 September 1991
• Docket Number: Civ. A. No. 88-0123-B.
• Citation: 775 F. Supp. 191
• Parties: APPALACHIAN AGENCY FOR SENIOR CITIZENS, et al., Plaintiffs, v. Thelma BLAND in her official capacity as the Commissioner of the Virginia Department of the Aging, Defendant.
• Court: U.S. District Court — Western District of Virginia

775 F. Supp. 191

APPALACHIAN AGENCY FOR SENIOR CITIZENS, et al., Plaintiffs, v. Thelma BLAND in her official capacity as the Commissioner of the Virginia Department of the Aging, Defendant.

Civ. A. No. 88-0123-B.

United States District Court, W.D. Virginia, Big Stone Gap Division.

September 19, 1991.

Gerald L. Gray, Gray and Morris, Clintwood, Va., for plaintiffs.

Carol S. Nance, Asst. Atty. Gen., Richmond, Va., for defendant.

MEMORANDUM OPINION

WILSON, District Judge.

This is an action for declaratory and injunctive relief under 42 U.S.C. § 1983 by five non-profit agencies that are authorized recipients of funds under Title III of the Older Americans Act ("OAA" or the "Act"), 42 U.S.C. §§ 3001 et seq. (Supp. 1991), against the Commissioner of the Virginia Department for the Aging (the "VDA"), Thelma Bland ("Bland"), alleging that Virginia's intrastate funding formula for the 1990-1991 fiscal years fails to comply with the requirements of the OAA primarily because the formula allegedly fails to reflect the proportion of older persons in the greatest economic or social need and because the Commonwealth of Virginia has not adequately justified the formula. The court previously rejected a challenge to the funding formula for the 1988-1989 fiscal years. Appalachian Agency for Senior Citizens v. Ferguson, 702 F.Supp. 1262 (W.D.Va.1988), appeal dismissed, 902 F.2d 27 (4th Cir.1990).¹ The appeal of that decision to the court of appeals was dismissed as moot following the promulgation of a new funding formula, and the case was remanded to permit plaintiffs to file an amended complaint. The issues raised by the amended complaint are currently before the court on cross-motions for summary judgment. Bland maintains that this action is precluded by the eleventh amendment and that three of the challenging agencies lack standing. The court finds that the action is not barred by the eleventh amendment, but finds it unnecessary to decide the question of whether three of the agencies have standing, because the standing of at least two of the agencies requires the court to decide the case on its merits. The court also finds that its role in reviewing the funding formula is to determine whether the formula is in compliance with federal law and rationally based rather than arbitrary and capricious. Thus, the court's role is not to supplant its judgment for the judgment of the state officials, who are charged with the responsibility of establishing the formula. Because the formula is found to be in compliance with federal law and rationally based, the challenge to the formula must be rejected.

The OAA of 1965, as amended, was enacted to promote the well-being of all older Americans by providing services and programs designed to help them live independently in their homes and communities. The centerpiece of the OAA is a comprehensive funding system for state and community programs and services established under Title III of the OAA. Under Title III, each state is allotted funds based upon its proportion of the total population in the United States age sixty or older. 42 U.S.C. § 3024(a)(1). Each state designates a state agency (in Virginia the VDA), which is responsible for developing and administering a two to four year plan implementing the Act's objectives. The state plan ultimately must be approved by the federal agency responsible for administering the Act nationally, the Administration on Aging ("AOA") of the Department of Health and Human Services. 42 U.S.C. § 3027(b). The state agency distributes the funds to an area agency on aging ("AAA") in each planning and service area within the state which, in turn, awards subgrants and contracts with local providers for services.

The Act requires preference to be given to "older individuals with the greatest economic or social needs," 42 U.S.C. § 3025(a)(2)(E), "with particular attention to low-income minority individuals." 45 C.F.R. § 1321.37(a) (1990). In addition, the state plan must "include proposed methods for carrying out the preference...." 42 U.S.C. § 3025(a)(2)(E). An "older individual" is defined as an individual sixty years of age or older. 42 U.S.C. § 3022(9). The "greatest economic need" is defined as "the need resulting from an income level at or below the poverty levels established by the Office of Management and Budget." 42 U.S.C. § 3022(20). The "greatest social need" is defined as "the need caused by non-economic factors which include physical and mental disabilities, language barriers, and cultural, social, or geographical isolation including that caused by racial or ethnic status which restricts an individual's ability to perform normal daily tasks or which threatens such individual's capacity to live independently." 42 U.S.C. § 3022(21).

In addition to developing a state plan, the designated state agency must develop a funding formula, under guidelines issued by the Commissioner of the AOA, for the distribution of funds "taking into account, to the maximum extent feasible, the best available statistics on the geographical distribution of individuals aged 60 and older in the State...." 42 U.S.C. § 3025(a)(2)(C). AOA regulations implement the preference provisions of the Act by requiring each state's funding formula to "reflect the proportion among the planning and service areas of persons age 60 and over in greatest economic or social need with particular attention to low-income minority individuals." 45 C.F.R. § 1321.37(a). The formula is published for "review and comment" by the public, 42 U.S.C. § 3025(a)(2)(C), and ultimately is submitted to the Commissioner for "review and comment." 42 U.S.C. § 3025(a)(2)(D).²

In 1989, the Virginia Secretary of Health and Human Resources appointed a thirty-two member task force "to develop the Virginia State Application for Older Americans Act Funds." The task force was divided into various work groups, including a "Formula Allocation Work Group," to develop and recommend an intrastate funding formula. In April of 1989, the work group recommended to the task force a funding formula, which was submitted without modification for public comment. Following five public hearings at various locations throughout Virginia, the proposed formula recommended by the work group, together with transcriptions of the five public hearings, documents, and written comments, was submitted to the task force. After considering the testimony, documents, and written comments, the task force recommended the formula in July of 1989. In August of that year, the governor approved the state plan and the formula and later submitted them to the AOA. The AOA approved the state plan and reviewed the formula without adverse comment.³

Under the formula, funds for fiscal years 1990-1991 are allocated as follows:

                    Population 60+             30%
                    Rural population 60+       10%
                    Poverty population 60+     50%
                    Minority population 60+    10%
                

Bland Affidavit (6/18/90), Exhibit C at 3. However, Virginia adopted a "hold harmless" policy insuring that no agency's funds would fall below its 1989 funding level and that no agency would receive less than $100,000.00. The purpose of the "hold harmless" provision was to prevent a major "disruption of services" in the event of "significant shifts in funding" from 1989 to the 1990-1991 fiscal years. Taking into account the receipt of general state funds, "all area agencies have received funds during Fiscal Years 1990 and 1991 in excess of any allocation of federal and state match sic funds that would have been provided under the formula without the `hold harmless' provision." Bland Affidavit (9/16/91) at 3.

Plaintiffs are five of Virginia's twenty-five AAAs, which allegedly are receiving "less funding than if the formula conformed to the requirements of the OAA": Appalachian Agency for Senior Citizens, Inc., which serves Dickenson, Buchanan, Tazewell and Russell Counties; District III Governmental Cooperative, which serves Washington, Smyth, Wythe, Bland, Grayson, and Carroll Counties and the Cities of Galax and Bristol; Jefferson Area Board for Aging, which serves Nelson, Albemarle, Louisa, Fluvanna, and Greene Counties, and the City of Charlottesville; Mountain Empire Older Citizens, Inc., which serves Lee, Wise, and Scott Counties, and the City of Norton; and New River Valley Agency on Aging, which serves Giles, Floyd, Pulaski, and Montgomery Counties, and the City of Radford.⁴ Three of the AAAs, District III Governmental Cooperative, New River Agency on Aging, and Jefferson Area Board for Aging, were formed by cooperating local governments pursuant to Va.Code Ann. § 15.1-21 (Cum. Supp.1991). The remaining two AAAs, the Appalachian Agency for Senior Citizens, Inc. and the Mountain Empire Older Citizens, Inc., are private non-profit corporations.

I.

Although Bland challenges the three governmental AAAs' standing to sue under 42 U.S.C. § 1983, the court finds it unnecessary to reach the issue because the two non-governmental AAAs, the Appalachian Agency for Senior Citizens, Inc. and the Mountain Empire Older Citizens, Inc., have standing to challenge the funding formula as advocates for the elderly. The Act specifically provides that an AAA is to "serve as the advocate and focal point for the elderly within the community by monitoring, evaluating, and commenting upon all policies, programs, hearings, levies, and community actions which will affect the elderly." 42 U.S.C. § 3026(a)(6)(D). Consequently, as stated in Meek v. Martinez, 724 F.Supp. 888, 901 (S.D.Fla.1987), "the AAA is within the zone of interests protected by the Act," which confers "direct standing" upon it.

II.

Bland argues that this action is barred by the eleventh amendment because a suit against a state official in his official capacity is, in effect, a suit against the state. Bland's argument, however, ignores Ex parte Young, 209 U.S. 123, 28 S.Ct. 441, 52 L.Ed. 714 (1908). "Ex parte Young recognized an exception to the...