Coastal Counties Workforce, Inc. v. Lepage, 1:17–cv–00417–JAW

Decision Date03 January 2018
Docket Number1:17–cv–00417–JAW
Parties COASTAL COUNTIES WORKFORCE, INC., Plaintiff, v. Paul R. LEPAGE, et al., Defendants.
CourtU.S. District Court — District of Maine

Kelly W. McDonald, Sage M. Friedman, Murray Plumb & Murray, Portland, ME, for Plaintiff.

Nancy M. Macirowski, Susan P. Herman, Office of the Attorney General, Augusta, ME, for Defendants.


John A. Woodcock, Jr. United States District Judge

A local workforce training organization claims the Maine Governor and the Commissioner of the Maine Department of Labor (MDOL) failed to make funds available to it in a manner and time frame that federal law requires. The local workforce organization, Coastal Counties Workforce, Inc. (CCWI), seeks declaratory and injunctive relief under the Workforce Innovation and Opportunity Act (WIOA, the Act) and 42 U.S.C. § 1983, against Governor Paul R. LePage and Commissioner John Butera (Defendants). The Defendants filed a motion to dismiss for failure to state a claim upon which relief may be granted, arguing that WIOA does not provide CCWI a private right of action.

The Court denies the Defendants' motion to dismiss because it concludes that WIOA does provide CCWI a right enforceable through § 1983 : the right to the prompt pass through of federal funds through the state of Maine on a program year basis. The Court grants CCWI's motion for a preliminary injunction because it will likely prevail on the merits, two of the other factors weigh in its favor, and the last, the public policy question, is in equipoise.

A. Procedural History

On October 24, 2017, CCWI filed a complaint and a motion for temporary restraining order (TRO). Compl. (ECF No. 1); Pl.'s Mot. for a TRO (ECF No. 3). Six days later, on October 30, 2017, the Court held a status conference with the parties. Min. Entry for Telephone Conference (ECF No. 7).

After the conference, the Court ordered the parties to confer and, if unable to resolve the lawsuit, to discuss scheduling further written submissions and discovery issues. Order (ECF No. 8). The Court indicated that if the parties could not agree on scheduling issues, the Court would issue a scheduling order. Id.

On November 9, 2017, the Court held a second telephone status conference. Min. Entry for Telephone Conference (ECF No. 12). The Defendants agreed to make certain funds available to CCWI for Program Year 2016 (PY16), but the parties did not fully resolve the lawsuit, with funds for Program Year 2017 (PY17) still contested. With some of the urgency removed, counsel for CCWI agreed to pursue a preliminary injunction, rather than a TRO. Accordingly, the Court dismissed CCWI's motion for a TRO without prejudice on the same day. Order (ECF No. 13). Counsel for the Defendants stated they intended to file a motion to dismiss. On November 13, 2017, the Court issued a scheduling order for the upcoming motions and a testimonial hearing. Pre–Hr'g Scheduling Order (ECF No. 14).

On November 17, 2017, CCWI filed a motion for a preliminary injunction. Pl.'s Mot. for Prelim. Inj. (ECF No. 16) (Pl.'s Inj. Mot. ). On December 6, 2017, the Defendants filed their response in opposition to the motion for a preliminary injunction. Defs. Paul R. Lepage and John Butera's Mem. of Law in Opp'n to Pl.'s Mot. for a Prelim. Inj. (ECF No. 24) (Defs.' Inj. Opp'n ). On December 14, 2017, CCWI filed its reply. Pl.'s Reply Mem. of Law in Support of Mot. for Prelim. Inj. (ECF No. 35) (Pl.'s Inj. Reply ).

Also on November 17, 2017, the Defendants filed a motion to dismiss pursuant to Federal Rule of Civil Procedure 12(b)(6). Defs. Paul R. LePage and John Butera's Mot. to Dismiss (ECF No. 17) (Defs.' 12(b)(6) Mot. ). On November 29, 2017, CCWI filed its response in opposition to the Defendants' motion. Pl.'s Opp'n to Defs.' Mot. to Dismiss (ECF No. 20) (Pl.'s 12(b)(6) Opp'n ). On December 4, 2017, the Defendants filed their reply. Defs. Paul R. LePage and John Butera's Reply Mem. in Supp. of Mot. to Dismiss (ECF No. 23) (Defs.' 12(b)(6) Reply ).

On December 18, 2017, the Court held an evidentiary hearing and heard oral argument at the close of the hearing. Min. Entry for Hr'g (ECF No. 39).

B. Statutory Background: WIOA

Congress passed WIOA in 2014. Workforce Innovation and Opportunity Act, Pub. L. No. 113–128, 128 Stat. 1425 (2014). The purposes of WIOA include "increas[ing] ... access to and opportunities for the employment, education, training, and support services" and the "alignment of workforce investment, education, and economic development systems in support of a comprehensive, accessible, and high-quality workforce development system." 29 U.S.C. § 3101. The Act authorizes appropriations for fiscal years 2015 to 2020 and directs those funds to state and local workforce development efforts. Id. § 3181.

To receive the federal funds, the Act requires local areas and states to set up a series of boards to administer the program. A state's governor establishes a state workforce development board (SWDB), composed of the governor, a member of each chamber of the state legislature, business leaders, and officials from labor organizations. Id. § 3111(a)(b). The state board assists the governor in developing a state plan, as well as in overseeing the workforce development system, and in identifying aspects in need of improvement. Id. § 3111(d). A governor must submit a state plan on a four-year basis to the Secretary of Labor for approval.1 Id. § 3112(a), (c). A state plan must include details about the workforce development system, including how the federal funds will be used, the local areas designated in the state, and performance and accountability measures. Id. §§ 3112(b), 3141.

A governor must designate local areas to administer the education and training programs within a state based on considerations such as labor market factors, regional economic development, and the availability of resources. Id. § 3121(b). A governor and local chief elected officials, like county commissioners, must establish local workforce development boards. Id. § 3122(a), (c). Local boards must be composed of individuals from groups like local business leaders, officials from labor organizations, and members of economic and community development entities. Id. § 3122(b). Each local board submits a comprehensive local plan to the governor for approval on a four-year basis. Id. § 3123(a). The local plan outlines how designated entities and providers within the local area will implement the workforce development programs and carry out training, and specifies performance and accountability measures. Id. §§ 3123(b), 3141.

Once a governor approves the local plans, the Secretary approves the state plan, and Congress appropriates federal funds, the Secretary makes allotments to each state based on funding formulae specified in the statute. Id. §§ 3162, 3172. A governor may reserve certain percentages of the funds for statewide purposes but then must make allotments to each of the local areas based on statutory funding formulae. Id. §§ 3163, 3173. The funds "shall be available for obligation only on the basis of a program year" running from July 1 to the following June 30. Id. § 3249(g). Funds the states and local areas receive during one program year "may be expended during that program year and the succeeding program year." Id.

The statute requires the "prompt allocation of funds" at each level of administration. Id. § 3242. All funds the Secretary allots to the states "shall be allotted within 45 days after the date of enactment of the Act appropriating the funds." Id. § 3242(c). The funds a governor is required to allot to the local area "shall be made available ... for a local area not later than 30 days after the date the funds are made available" to the governor "or 7 days after the date the local plan for the area is approved, whichever is later."Id. § 3242(e).

C. The Facts2
1. The Parties and Maine's Workforce Training System

Paul R. LePage is the Governor of the state of Maine. Compl. ¶ 8. John Butera is the Commissioner of MDOL. Id. ¶ 9. CCWI is a Maine non-profit corporation with a principal place of business in Brunswick, Maine. Id. ¶ 7.

There are three Local Workforce Investment Areas in Maine, each with its own Local Workforce Development Board. Id. ¶ 14; Stipulation of Facts ¶¶ 9–11 (ECF No. 32) (Stipulations ). The local areas consist of the Coastal Counties Region (York, Cumberland, Sagadahoc, Lincoln, Waldo, and Knox Counties); the Northeastern Region (Aroostook, Piscataquis, Penobscot, Hancock, and Washington Counties); and the Central/Western Region (Somerset, Franklin, Oxford, Androscoggin, and Kennebec Counties). Compl. ¶ 15; Stipulations ¶¶ 9–11. Under the current system, the local boards and the local chief elected officials delegate the administration and oversight of WIOA funds to an entity created for that purpose for each of the three local areas (the workforce groups). Compl. ¶ 22; Stipulations ¶¶ 12–13. The workforce groups are largely or entirely funded by money Congress allocated under WIOA. Compl. ¶ 23.

CCWI is the entity the local board and the chief elected officials created to oversee the use of WIOA funds for the Coastal Counties Region. Compl. ¶ 27; Stipulations ¶ 13. CCWI uses the allocation of approximately $3 million each year to fund programs designed to help dislocated workers, low income adults, and young adults with barriers to employment throughout the Coastal Counties Region. Compl. ¶ 28.

By letter dated June 6, 2016, the former Commissioner of MDOL, writing as the designee for Governor LePage, confirmed that CCWI had been granted local area designation for the Coastal Counties Region. Compl. ¶ 29. By letter dated September 12, 2016, the former Commissioner of the MDOL granted conditional approval of the Coastal Counties Workforce Board's 20162020 local plan. Id. ¶ 30; Stipulations ¶ 16. This conditional approval remains in effect today. Id. CCWI...

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