Milwaukee County, Wis. v. Donovan

• Decision Date: 06 August 1985
• Docket Number: No. 84-1067,84-1067
• Citation: 771 F.2d 983
• Parties: MILWAUKEE COUNTY, WISCONSIN, Petitioner, v. Raymond J. DONOVAN, Secretary of the United States Department of Labor, Respondent.
• Court: U.S. Court of Appeals — Seventh Circuit

Page 983

771 F.2d 983

MILWAUKEE COUNTY, WISCONSIN, Petitioner, v. Raymond J. DONOVAN, Secretary of the United States Department of Labor, Respondent.

No. 84-1067.

United States Court of Appeals, Seventh Circuit.

Argued Sept. 20, 1984.

Decided Aug. 6, 1985. ^*

As Amended Aug. 26, 1985.

Rehearing and Rehearing En Banc

Denied Sept. 9, 1985.

Charles D. Clausen, Friebert, Finerty & St. John, Milwaukee, Wis., for petitioner.

Ellen L. Beard, Office of the Solicitor, U.S. Dept. of Labor, Washington, D.C., for respondent.

Before ESCHBACH and COFFEY, Circuit Judges, and GRANT, Senior District Judge. ^**

ESCHBACH, Circuit Judge.

This dispute arises out of the development and administration by Milwaukee County, Wisconsin ("County" or "Petitioner") of programs funded under the Comprehensive Employment and Training Act ("CETA" or "Act"), 29 U.S.C. Secs. 801-999 (Supp. II 1978). The County petitions for review of an order of the Secretary of the United States Department of Labor ("Secretary") in which it was determined, inter alia, that (1) in 1977 and 1978, the County had substituted approximately $1.2 million in federal CETA funds for County funds in violation of CETA "maintenance of effort" requirements; (2) the County, because of a violation of CETA wage and benefit regulations, was required to perform a record review and provide backpay and benefits to former participants; (3) costs associated with 17 ineligible CETA participants would be disallowed; and (4) a former County employee was entitled to backpay for wrongful discharge. In addition, the County now argues that the Secretary was barred from ordering relief because he failed to observe the statutory time limits for the processing of claims against CETA grantees. For the reasons stated below, we grant in part and deny in part the petition for review.

I. Procedural History

This action arose from the consolidation of a series of complaints filed with the United States Department of Labor ("DOL"). The first written complaint was received by the DOL in February 1978. A second letter of complaint, containing 57 issues and signed by 22 persons, was received in May 1978. Most of the matters raised in the initial complaint were alleged in more detail in the second complaint. A third complaint in December 1979 added 16 new allegations. Two additional and independent complaints were filed in May 1978 and January 1980. These five complaints were subsequently consolidated with other individual complaints.

The Grant Officer issued his initial determination on May 29, 1979. In response to a hearing request from the representative of one of the parties filed on December 11, 1979, the Office of the Administrative Law Judges ordered the Grant Officer to provide his final determination by December 30; the final determination was in fact issued on January 4, 1980.

Hearings before the ALJ began on August 4, 1980, and were concluded on March 13, 1981, with the ALJ issuing his decision on December 5, 1983. This petition for review followed. ¹

II. Jurisdiction

Before considering the merits of the Secretary's order, we address the threshold argument presented by Petitioner that, because the "final determination" of the Grant Officer was not issued within 120 days of the receipt of the initial complaint, the Secretary was divested of jurisdiction under Sec. 106(b) of the Act, 29 U.S.C. Sec. 816(b) (Supp. II 1978), and, therefore, was "barred from recovering against the petitioner." After a thorough examination of the language of Sec. 106(b), its legislative history, and the general purpose behind the 1978 amendments to the Act, we conclude that the 120-day limit of Sec. 106(b) is not jurisdictional and, therefore, that the Secretary had the authority to proceed against Petitioner. ²

We would initially note the well-established canon of construction that a single provision will not be interpreted so as to defeat the general purpose that animates and informs a particular legislative scheme. See Bob Jones University v. United States, 461 U.S. 574, 586, 103 S.Ct. 2017, 2025-26, 76 L.Ed.2d 157 (1983); United States v. American Trucking Associations, Inc., 310 U.S. 534, 543-44, 60 S.Ct. 1059, 1063-64, 84 L.Ed. 1345 (1940). We, of course, do not substitute our judgment for that of Congress, but merely attribute to that legislative body a general overriding intent to avoid results that would undermine or vitiate the purposes of specific provisions. Cf. Sorrells v. United States, 287 U.S. 435, 447, 53 S.Ct. 210, 214, 77 L.Ed. 413 (1932).

In addition, it is beyond dispute that the 1978 amendments to the Act were "remedial" in nature, in that they were intended to give the Secretary greater power to prevent and correct the fraud and abuse that had developed in CETA programs. See S.Rep. No. 891, 95th Cong., 2d Sess. 42-43 (1978), reprinted in 1978 U.S.Code Cong. & Ad.News 4480, 4522-23; H.R.Rep. No. 1124, 95th Cong., 2d Sess. 3, 5-6, 13 (1978); 124 Cong.Rec. 27,789 (remarks of Sen. Bellmon), 27,223 (remarks of Sen. Nelson), 25,183 (remarks of Rep. Myers), 25,182 (remarks of Rep. Lehman), 25,168 (remarks of Rep. Hawkins) (1978); see also 18 U.S.C. Sec. 665; 29 U.S.C. Secs. 816(d)(1), (e), (f), 825(g), 836 (Supp. II 1978). We acknowledge, of course, that the term "remedial" does not have talismanic significance in the construction of legislation. Cf. Zimmerman v. North American Signal Co., 704 F.2d 347, 353 (7th Cir.1983). It does, however, affect the presumptions to be employed. With reference to the 1978 CETA amendments, we must in doubtful situations indulge in a presumption in favor of the Secretary's jurisdiction and will construe the Act accordingly.

Section 106(b) provides in relevant part:

Investigation Of Complaints By Secretary

Whenever the Secretary receives a complaint from any interested person or organization ... which alleges, or whenever the Secretary has reason to believe ... that a recipient of financial assistance under this chapter is failing to comply with the requirements of this chapter, the regulations under this chapter or the terms of the comprehensive employment and training plan, the Secretary shall investigate the matter. The Secretary shall conduct such investigation, and make the final determination required by the following sentence regarding the truth of the allegation or belief involved, not later than 120 days after receiving the complaint. If, after such investigation, the Secretary determines that there is substantial evidence to support such allegation or belief that such a recipient is failing to comply with such requirements, the Secretary shall, after due notice and opportunity for a hearing to such recipient, determine whether such allegation or belief is true.

It should be noted that Sec. 106(b), when read as a whole, is opaquely written and that the second sentence of the provision, when considered in isolation, seems to require a "final determination" within 120 days of the receipt of the complaint. It should also be noted that Sec. 106(b) does not expressly address the situation presented in the instant case, i.e., the timing requirements for the final determination after the consolidation of numerous related complaints.

The second sentence did not in fact appear in the original bill, but was proposed by Congressman Obey and added as an amendment during the floor debates on the 1978 amendments to the Act. 124 Cong.Rec. 25,230-31 (1978). The Obey amendment actually contained two separate provisions. The first required that the prime sponsor reach a decision on a grievance within 60 days after the filing of the grievance; the second was the 120-day provision at issue in the instant dispute. After the reading of the amendments, the following colloquy occurred:

Mr. OBEY. Mr. Chairman, I understand this amendment will be accepted by the committee. It is a very simple amendment. All it does is put a specific period of time in the bill during which the prime sponsor must answer a complaint lodged against it for violations of the conditions under which the CETA program exists in the first place, and also it establishes a 120-day time limit on the time during which the Labor Department can consider a complaint before it has to proceed.

....

Mr. HAWKINS [sponsor of original bill]. Mr. Chairman, we have seen the amendment. We accept the amendment.

If [Mr. OBEY] would further yield, do I understand from [him] that if the determination is not made in a specified time it shall not affect the Secretary's jurisdiction in the matter?

Mr. OBEY. That is correct.

Mr. HAWKINS. With that understanding we do accept the amendment.

Id.

Thus, it is clear from this exchange that the author of the 120-day provision and the sponsor of the original bill did not consider it jurisdictional in any way. Of course, these statements are not controlling; nevertheless, we find them highly persuasive. They were made by the author of the amendment and the sponsor of the original bill on the floor of the House during debates on the bill. In addition, no contrary view of the jurisdictional effect of the amendment was expressed, no objection was voiced, and nothing in the record indicates that Congress may have had an intent different from that expressed in this exchange.

We also find further support for our position in the general purposes of the 1978 amendments to the Act. ³ To ensure that CETA funds would not be diverted from their intended purposes, Congress sought to grant the Secretary "maximum authority to protect the integrity of the program." S.Rep. No. 891, supra, at 21, reprinted in 1978 U.S.Code Cong. & Ad.News at 4480, 4501. It is also evident that Congress was aware that the DOL commanded insufficient resources to handle CETA investigations and that there was a backlog in the Department. See id. at 42, reprinted in 1978 U.S.Code Cong. & Ad.News at 4522; H.R.Rep. No. 1124, 95th Cong., 2d Sess. 3, 5-6, 13; see also 124 Cong.Rec. 31,021 (1978) (remarks of...