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01/20/87 City of New Haven, v. United States of America

January 20, 1987

CITY OF NEW HAVEN, CONNECTICUT

v.

UNITED STATES OF AMERICA, APPELLANT; NATIONAL LEAGUE OF CITIES, ET AL.

v.

SAMUEL R. PIERCE, JR., SECRETARY OF

MUNICIPAL CORPORATION, ET AL

v.

U.S. DEPARTMENT OF HOUSING AND URBAN



Before: EDWARDS and BORK, Circuit Judges, and SWYGERT,* Senior Circuit Judge, United States Court of Appeals for the Seventh Circuit.

UNITED STATES COURT OF APPEALS FOR THE DISTRICT OF COLUMBIA CIRCUIT

H.U.D., et al., APPELLANTS; CITY OF CHICAGO, a

DEVELOPMENT, et al., APPELLANTS

Nos. 86-5319, 86-5320, 86-5321 1987.CDC.26

Date Decided: January 20, 1987; As Amended, November 4, 1986.

Appeals from the United States District Court for the District of Columbia, Civil Action Nos. 86-00455, 86-00460 and 86-00967.

APPELLATE PANEL:

DECISION OF THE COURT DELIVERED BY THE HONORABLE JUDGE EDWARDS

The majority of proposed deferrals are routine "programmatic" deferrals, by which the Executive Branch attempts to meet the inevitable contingencies that arise in administering congressionally-funded agencies and programs. Occasionally, however, the President will seek to implement "policy" deferrals, which are intended to advance the broader fiscal policy objectives of the Administration. The critical distinction between "programmatic" and "policy" deferrals is that the former are ordinarily intended to advance congressional budgetary policies by ensuring that congressional programs are administered efficiently, while the latter are ordinarily intended to negate the will of Congress by substituting the fiscal policies of the Executive Branch for those established by the enactment of budget legislation.2

In the instant case, the President invoked section 1013 as authority for implementing four separate policy deferrals. In particular, the President deferred the expenditure of funds earmarked for four housing assistance programs to be administered by the Department of Housing and Urban Development . The appellees - various cities, mayors, community groups, members of Congress, associations of mayors and municipalities and disappointed expectant recipients of benefits under the four programs - brought these consolidated actions challenging the authority of the President to implement policy deferrals pursuant to section 1013.3 That challenge was based on the inclusion in the statute of a legislative veto provision of the type held unconstitutional by the Supreme Court in Immigration an Naturalization Service v. Chadha, 462 U.S. 919, 77 L. Ed. 2d 317, 103 S. Ct. 2764 (1983). According to the appellees, the unconstitutional legislative veto provision contained in section 1013 rendered the entire section invalid, leaving the President without statutory authority on which to base the deferrals in question. The appellees requested a declaratory judgment that section 1013 was void in its entirety and an injunction obligating the nominal defendants (the United States, the Secretary of HUD and the Director of the Office of Management and Budget) to release the funds appropriated by Congress for the four HUD programs.

After carefully analyzing the intent of Congress in enacting section 1013, the District Court held that the section's unconstitutional legislative veto provision was inseverable from the remainder of the section. City of New Haven v. United States, 634 F. Supp. 1449 (D.D.C. 1986). Accordingly, it declared section 1013 void in its entirety and ordered the defendants-appellants to make the deferred funds available for obligation. Id. at 1460. Shortly thereafter, however, the President signed into law legislation overturning the challenged deferrals.4 Pursuant to this legislation, the funds deferred by the President have been made available for obligation.

For much the same reasons offered by the District Court in it thorough and able opinion, we hold that the unconstitutional legislative veto provision in section 1013 is inseverable from the remainder of that section. We therefore affirm the District Court's declaratory judgment striking down section 1013 in its entirety. We hold, however, that the request for injunctive relief is now moot. I. BACKGROUND

In November of 1985, President Reagan signed HUD's fiscal year 1986 appropriations bill.5 Included in that bill were appropriations for four programs administered by HUD: the Community Development Block Grant Program, under which HUD makes grants to state and local governments for community development projects;6 the Section 8 Housing Assistance Payments Program, under which HUD provides subsidies (through public housing agencies) to low-income families to enable them to obtain low-cost housing;7 the Section 312 program, under which HUD lends money (typically to cities or local public agencies) to be used to rehabilitate residential property in low-income neighborhoods;8 and the Section 202 program, under which HUD lends money to rehabilitate low-cost rental units for the handicapped and the elderly.9 In February of 1986, the President sent impoundment notices to Congress pursuant to section 1013 announcing his intention to defer the expenditure of funds for these four programs. One of the reasons provided by the President for the deferrals was to bring 1986 spending levels into line with the Administration's 1987 proposed budget. See 51 Fed. Reg. 5953-58 (1986). Previously, the president had failed in his efforts to convince Congress to drastically reduce these expenditures in its 1986 budget. Thus, it is not disputed that the deferrals were made for "policy" reasons.

Because the President relied solely on section 1013 as authority for the deferrals, the District Court was faced squarely with the question whether the unconstitutional legislative veto provision in section 1013 is severable from the remainder of that section. This question, the District Court recognized, was purely one of congressional intent. Specifically, the court was required to consider what Congress would have done had it known at the time it passed section 1013 that the legislative veto provision was unconstitutional. Would Congress nonetheless have conferred deferral authority on the President, even though it could not exercise control over that authority by means of a legislative veto? Or would Congress have ...


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