U.S. v. Board of Educ. of City of Chicago
| Decision Date | 26 September 1984 |
| Docket Number | No. 84-2405,84-2405 |
| Citation | 744 F.2d 1300 |
| Parties | 20 Ed. Law Rep. 420 UNITED STATES of America, Plaintiff-Appellant, v. BOARD OF EDUCATION OF the CITY OF CHICAGO, Defendant-Appellee. |
| Court | U.S. Court of Appeals — Seventh Circuit |
William B. Reynolds, Asst. Atty. Gen., Dept. of Justice, Washington, D.C., for plaintiff-appellant.
Robert C. Howard, Hartunian, Futterman & Howard, Chtd., Chicago, Ill., for defendant-appellee.
Before CUMMINGS, Chief Judge, and WOOD and FLAUM, Circuit Judges.
This case comes before us for the second time on appeal from an order of the district court interpreting and enforcing a consent decree that was executed by the United States and the Board of Education of Chicago ("Board"). For the reasons set forth below, we vacate the order and remand this case for an evidentiary hearing.
As we explained in our first opinion, see United States v. Board of Education of Chicago, 717 F.2d 378 (7th Cir.1983), this case arises from a complaint that the United States filed against the Board on September 24, 1980, charging that Chicago's public school system was racially segregated in violation of the fourteenth amendment and titles IV and VI of the Civil Rights Act of 1964. On the same day, the parties filed a previously-negotiated consent decree ("Decree") in which they agreed that the Board would develop and implement a system-wide plan to remedy the effects of past segregation on black and Hispanic students in Chicago schools. Beginning in 1981, the Board developed and implemented a desegregation plan, which was later approved by the district court. See United States v. Board of Education of Chicago, 554 F.Supp. 912 (N.D.Ill.1983).
On May 31, 1983, the Board petitioned for an order directing the United States to comply with p 15.1 of the Decree, which provides that
[e]ach party is obligated to make every good faith effort to find and provide every available form of financial resources adequate for the implementation of the desegregation plan.
After five days of hearings, the district court entered an order on June 30, 1983 ("1983 Order"), finding that the United States had violated p 15.1 by failing to provide adequate desegregation funding, by taking no affirmative steps to find and provide such funding, and by taking affirmative steps to minimize and eliminate available sources of funding. See United States v. Board of Education of Chicago, 567 F.Supp. 272, 286-87 (N.D.Ill.1983). The court held that under the plain meaning of p 15.1, and also because the government actively worked to make funds unavailable, the United States was "obligated to take every affirmative step within its legal authority to find and provide adequate financing for the plan." Id. at 283 (Conclusion of Law No. 7). According to the district court, this obligation required the United States to provide presently available funds, to find every available source of funds, to support specific legislative initiatives to meet the obligations of the Board, and "not [to] fail[ ] to seek appropriations that could be used for desegregation assistance to the Board." Id. (Conclusion of Law No. 9). The court decided that, at a minimum, the United States was to provide the portion of funding adequate for full implementation of the desegregation plan that the Board could not provide, to the extent such funding was available to or could be made available by the United States. Id. at 287-88. For the 1983-84 school year, the district court found that this obligation was not less than $14.6 million, and the court enjoined the United States from spending or obligating certain funds in several of the Department of Education's monetary accounts so as to insure that these funds would remain available pending the final resolution of the case.
The United States appealed the 1983 Order, arguing that p 15.1 merely required it to make a good faith effort to assist the Board in locating and applying for funds that had been earmarked by Congress for school districts undergoing desegregation. In an opinion issued on September 9, 1983, this court rejected the government's argument; we interpreted p 15.1 as requiring the United States to do more than assist the Board in locating and applying for federal funds and as imposing "a substantial obligation on the government to provide available funds to the Board." United States v. Board of Education of Chicago, 717 F.2d at 383. 1
After considering the findings and conclusions of the district court, we refused to decide whether the United States violated p 15.1 of the Decree by taking such policy-oriented steps as requesting Congress to reduce or rescind appropriations for certain programs, supporting legislation that replaced direct grant programs with federal block grants, and supporting the dismantling of the Department of Education. Instead, we held that the United States violated p 15.1 by failing to provide available funds to the Board, and we specifically referred to funds from the Department of Education's Title IV account and Discretionary Fund. Id. & n. 8.
With regard to the issue of remedies, this court found that "the district court acted with excessive dispatch in delineating specific remedies immediately after finding a violation of p 15.1." Id. at 384. We held that "the district court should provide the Department [of Education] an opportunity to fashion its proposed remedy for past noncompliance, as well as a chance to show that it intends to comply in the future, before structuring detailed remedial action that may still be necessary." Id. at 385. Accordingly, we vacated all remedies, affirmed the temporary injunction against government use of certain funds so as to preserve the status quo, and remanded the case to the district court.
On September 21, 1983, United States Representative Sydney Yates proposed the following legislation:
There is hereby appropriated $20,000,000 to be derived by transfer from funds available for obligation in fiscal year 1983 in the appropriation for "Guaranteed Student Loans," to remain available for obligation until September 30, 1984, to enable the Secretary of Education to comply with the Consent Decree entered in United States District Court in the case of the United States of America against the Board of Education for the City of Chicago (80 C 5124) on September 24, 1980.
This provision ("the Yates Bill") was incorporated by Congress into H.J. Res. 368, a continuing resolution to provide temporary funding for several federal departments in fiscal year 1984. The President signed H.J. Res. 368 into law on October 1, 1983. Three days later, on October 4, United States Senator Lowell Weicker proposed an amendment to the Yates Bill ("the Weicker Amendment"), which was adopted by Congress on October 31, 1983, in the following form:
No funds appropriated in any act to the Department of Education for fiscal years 1983 and 1984 shall be withheld from distribution to grantees because of the provision of the order entered by U.S. District Court for Northern District of Illinois on June 30, 1983: Provided, that the Court's decree entered on September 24, 1980 shall remain in full force and effect.
In response to a motion that the Board submitted after the enactment of the Yates Bill, the district court ruled, on October 5, that as soon as the Secretary of Education obligated to the Board the $20 million allocated by the Yates Bill, the government would be permitted to use $15.66 million in the Department of Education accounts that remained temporarily frozen. On the same day, the United States moved the district court to vacate its 1983 Order and to declare that the $20 million allocated to the Board under the Yates Bill brought the United States into compliance with the Decree. The government renewed this motion on November 10, arguing that in light of the Yates Bill and the Weicker Amendment, no funds beyond the appropriated $20 million were available to the Board for fiscal years 1983 and 1984. The district court denied the government's motion on November 21, 1983.
At a status hearing on October 5, 1983, the district court decided that an evidentiary hearing, which originally had been scheduled for August 10, 1983, was still needed to determine the level of funding that the Board required in order to implement its desegregation plan. See Transcript of October 5, 1983, at 13-14. The government contended that the hearing exceeded our remand instructions to the extent that the hearing was to establish the Board's needs and the government's obligations beyond the $20 million allocated by the Yates Bill. See id. at 23; United States' Pre-Trial Brief on Remand Proceeding, dated March 13, 1984. From October 1983 to March 1984, the parties submitted numerous filings in preparation for the hearing, which began on March 23, 1984, and continued for nine days. Witnesses for the Board testified about the programs that the Board had developed under its desegregation plan, the costs of these programs, and the sources of program funding. In addition, the Board presented evidence of lobbying activity undertaken by the Executive Branch with regard to the Yates Bill and the Weicker Amendment. The United States called only one witness, who discussed the use of federal Title I funds for desegregation expenses.
On June 8, 1984, the district court issued an extensive opinion ("1984 Opinion") in which it reviewed the evidence presented during the hearing. 588 F.Supp. 132. The court found from this evidence that most of the programs under the Board's desegregation plan materially aid the successful implementation of the plan and that the costs of these programs are reasonable under the circumstances. See 1984 Findings of Fact Nos. 210-59. Furthermore, the...
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