Chula Vista City School Dist. v. Bell

• Decision Date: 04 June 1985
• Docket Number: 83-5631,Nos. 83-5627,s. 83-5627
• Citation: 762 F.2d 762
• Parties: CHULA VISTA CITY SCHOOL DISTRICT, Plaintiff/Appellee, v. T.H. BELL, United States Secretary of Education, Defendant/Appellant. CHULA VISTA CITY SCHOOL DISTRICT, Plaintiff/Appellant, v. T.H. BELL, United States Secretary of Education, Defendant/Appellee.
• Court: U.S. Court of Appeals — Ninth Circuit

Page 762

762 F.2d 762

53 USLW 2631

CHULA VISTA CITY SCHOOL DISTRICT, Plaintiff/Appellee, v. T.H. BELL, United States Secretary of Education,

Defendant/Appellant.

CHULA VISTA CITY SCHOOL DISTRICT, Plaintiff/Appellant, v. T.H. BELL, United States Secretary of Education, Defendant/Appellee.

Nos. 83-5627, 83-5631.

United States Court of Appeals Ninth Circuit.

Argued and Submitted Dec. 5, 1984.

Decided June 4, 1985.

Donald Jay Solomon, Leonard W. Pollard, II, San Diego, Cal., for Chula Vista City School Dist.

Howard S. Scher, Dept. of Justice, Washington, D.C., for T.H. Bell.

On appeal from the United States District Court for the Southern District of California.

Before WALLACE, BOOCHEVER and HALL, Circuit Judges.

BOOCHEVER, Circuit Judge:

At issue is the validity of a rule used by the Secretary of Education in determining the amount granted to local school districts by the federal government to compensate them for the burden of educating children who live on federal property that the districts cannot tax. We uphold the Secretary's rule.

BACKGROUND

Most school districts and local education agencies (LEA's) are funded by a tax on the value of real property within their boundaries. States and their subdivisions, however, may not tax property owned by the federal government. See generally H.R.Rep. No. 2287, 81st Cong., 2d Sess. 1-2 (1950) [hereinafter cited as House Report]. To mitigate various burdens placed on school districts by federal ownership, Congress enacted the Act of Sept. 30, 1950, ch. 1124, 64 Stat. 1100 (codified as amended at 20 U.S.C. Secs. 236-241ff (1982 & Supp. I 1983)) (the "Impact Aid law" or the "statute"). At the center of this controversy is 20 U.S.C. Sec. 238 which addresses specifically LEA's, such as the plaintiffs, which must educate children whose parents live or work on nontaxable federal property. The section provides that for each such child an LEA shall receive an amount which is based on the amount spent from local revenues per child in "generally comparable" school districts. 20 U.S.C. Sec. 238(d)(3)(A). The statute leaves the determination of comparability to the Secretary, who has promulgated regulations therefor. See 34 C.F.R. pt. 222 (1984) (previously codified at 45 C.F.R. pt. 115). Two methods are presently used to make this determination. Under the one used in California, a district selects approximately five Since he began to administer the statute in 1950, the Secretary has employed the "$50 Rule" (the Rule) disputed here. If the average local contribution of the five selected districts is more than $50 in excess of the local contribution per non-federally-connected child in the subject district, they are not considered comparable. In effect, the rule awards for each federally-connected child approximately the amount a district raises locally for its non-federally-connected children.

other districts in the state which it believes are generally comparable to itself. The selections are subject to the Secretary's disapproval. See 20 U.S.C. Sec. 238(d)(3)(A); 34 C.F.R. Secs. 222.30-.32 (1984).

In addition to the $50 Rule, the Secretary's regulations require that the allegedly comparable districts be similar to the applicant district upon at least five of fourteen criteria in a "grid" comprising legal classification, total average daily attendance, total cost per pupil, cost per pupil paid from local sources, grade levels maintained, percent of pupils transported, pupil-teacher ratio, assessed valuation per pupil, ratio of assessed value to true value, tax rate for all school purposes, tax rate for current expenses, curricula offered, teachers' salaries, and economic characteristics.

Eight districts, which had previously filed applications conforming to the regulations, amended and resubmitted them when they learned the Department had decided as an experimental policy not to enforce the $50 Rule. In May and June of 1979 analysts in the Department of Education approved the eight applications, employing the grid but not requiring adherence to the Rule. In those applications, the applicants designated as "generally comparable," districts which were similar on at least five of the grid's criteria but whose local contributions far exceeded those of the applicant. For example, class representative Chula Vista's local contribution in the year used for purposes of comparison was $467 while those of the districts named in its application averaged $1,473.

In July the Director of the Division of School Assistance in Federally Affected Areas (DSAFA) decided to deny the applications on the ground, inter alia, that they did not comply with the Department's regulations.

The school district challenged the denial. The Administrative Law Judge held that the $50 Rule was consistent with the statute and the regulations and that it was not required by the General Education Provisions Act (GEPA), 20 U.S.C. Secs. 1221-1234e (1982 & Supp. I 1983), to be published before promulgation. The Secretary declined to review this decision and plaintiffs appealed.

On cross motions for summary judgment, the district court reversed, holding that the $50 Rule was inconsistent with the legislative intent of the statute. The court agreed, however, that GEPA was not violated by the Department's failure to publish the rule. The court ordered the Secretary to review the amended applications whose approval had been rescinded by the Director of DSAFA and to award applicants amounts equivalent to the local contributions of the allegedly comparable districts if those districts were similar to the applicants on the first and fourth grid criteria and any three of the other twelve.

I. Jurisdiction

Although we ordinarily will not consider issues which were not raised below, we must inquire sua sponte whether the district court had subject matter jurisdiction of this action. Fed.R.Civ.P. 12(h)(3); Clark v. Paul Gray, Inc., 306 U.S. 583, 588, 59 S.Ct. 744, 748, 83 L.Ed. 1001 (1939).

The Tucker Act, 28 U.S.C. Secs. 1346(a)(2), 1491 (1982), vests exclusive jurisdiction in the Claims Court of actions against the United States which are based on "any Act of Congress, or any regulation of an executive department" and which seek monetary damages in an amount greater than $10,000. "Moreover, it is firmly established that, where the real effort of the complaining party is to obtain money from the federal government, the exclusive jurisdiction The instant appeal is from a class action represented by Chula Vista City School District (Chula Vista) and an action brought jointly by Poway Unified School District (Poway) and Sweetwater Union High School District (Sweetwater), which were consolidated in the district court. Although both complaints purport to ask for equitable relief, the "real effort" of each is to seek money. Chula Vista's complaint demanded "[t]hat the [District] Court declare that the class members be entitled to the local contribution rates requested in their highest revised Applications for ... 1979" and "issue a mandatory injunction ordering ... Defendant to ... pay to the class members [aid for] 1979 based on their highest revised Applications." Similarly, plaintiffs Poway and Sweetwater prayed "[t]hat the court declare that plaintiffs are entitled to the local contribution rate requested in their revised applications for ... 1979" and "compel defendant ... to approve their revised applications."

of the court of claims ... cannot be evaded ... by framing a district court complaint to appear to seek only injunctive, mandatory or declaratory relief against government officials...." Bakersfield City School District v. Boyer, 610 F.2d 621, 628 (9th Cir.1979); accord McKeel v. Islamic Republic of Iran, 722 F.2d 582, 590-91 (9th Cir.1983), cert. denied, --- U.S. ----, 105 S.Ct. 243, 83 L.Ed.2d 182 (1984).

The revised applications of plaintiffs Poway and Sweetwater requested, in addition to aid already paid pursuant to applications that conformed with the $50 Rule, $462,000 and $167,000 respectively. These claims clearly exceeded the jurisdictional amount.

The aggregate claims of the class that were denied by the Secretary total in excess of twelve million dollars. The claims of the class members, however, do not stem from "a single title or right in which they have a common and undivided interest." Snyder v. Harris, 394 U.S. 332, 335, 89 S.Ct. 1053, 1056, 22 L.Ed.2d 319 (1969) (discussing aggregation for diversity jurisdiction in class action). Thus, in determining the amount in controversy for jurisdictional purposes, this court looks to the claim of each individual class member rather than the total claims of the class. Kester v. Campbell, 652 F.2d 13, 15 (9th Cir.1981) (Tucker Act, class action), cert. denied, 454 U.S. 1146, 102 S.Ct. 1008, 71 L.Ed.2d 298 (1982); March v. United States, 506 F.2d 1306, 1309 n. 1 (D.C.Cir.1974) (same); see also Zahn v. International Paper Co., 414 U.S. 291, 301, 94 S.Ct. 505, 512, 38 L.Ed.2d 511 (1973) (minimum amount for diversity jurisdiction, class action); Glover v. Johns-Manville Corp., 662 F.2d 225, 231 (4th Cir.1981) (Tucker Act, multiple third-party complainants). Class members whose claims appear on the record to meet the jurisdictional requirement can maintain the action, but the others must be dismissed. See Zahn, 414 U.S. at 301, 94 S.Ct. at 512 (diversity jurisdiction); Paul Gray, 306 U.S. at 590, 59 S.Ct. at 749 (same). The difference between the amounts requested in the original and the amended applications of six of the fifty-five class members was ten thousand dollars or less. ¹ The claims of the other class members are dismissed for lack of jurisdiction.

II. Consistency of the $50 Rule With the Impact Aid Law

A. Standards of Review

This court reviews the district court's summary judgment de novo. Lojek v. Thomas, 716 F.2d 675, 677 (9th Cir.1983).

The amount of deference due to the Secretary's formulation of the Rule itself was stated in Good...