Legislation and Guidance
- Fraud and Abuse with Education Funding
- Budget and Farm Bill Top Congressional Agenda for June
- Supreme Court Rules in Two Workplace Retaliation Cases
- Rulemaking Pushback
Reports
Legislation and Guidance
Fraud and Abuse with Education Funding
Responsibility flows with federal dollars. When considering whether to use federal funds to support a specific expenditure, the grantee must undertake a three-step analysis. The grantee must ensure that the cost is allowable under:
- The applicable federal costs principles (OMB Circular A-21, A-87 or A-122);
- Education Department of General Administrative Regulations (EDGAR); and
- The applicable program statute (NCLB Title I, IDEA, or Perkins, for instance), along with accompanying program regulations and non regulatory guidance.
In order to spend federal funds appropriately, each cost must be allowable under the principles enumerated in all three.
It is the responsibility of the United States Department of Education (ED) to ensure that all federal education funds are spent appropriately in accordance with federal law and ED’s policies. ED’s primary missions are to improve the management of federal education activities and increase accountability of federal education programs to the President, Congress and the public. When this fails to happen, schools and districts end up in the newspapers, funds must be repaid to ED, and, in the worst case, administrators and accomplices may go to jail for stealing public funds.
Nobody wants to be on the wrong side of these issues and that is particularly true for Members of Congress. Washington was reminded of that this week when Howard "Buck" McKeon (R-CA), the Ranking Member of the House Committee on Education and Labor, and Mike Castle (R-DE) sent a letter to the Government Accountability Office (GAO) and ED’s Inspector General (IG) requesting specific information on the processes in place to monitor compliance with federal program and fiscal requirements at the state and local levels. Their letters also sought information on how ED uses findings of noncompliance to ensure corrective action, and whether such findings are used to identify areas for management reform on a broader scale.
The request included specific examples of "waste, fraud and abuse" in federal education programs, including:
- The fraudulent theft of 21st Century Grant monies in Franklin County, Florida;
- The unnecessary purchase of computer equipment and failure to provide matching funds in St. Paul, Minnesota; and
- Accepting bribes for the support and approval of vendor contracts in New Orleans, Louisiana.
The letters to the GAO and the Department of Education’s IG are available for download on the Education and Labor Committee Republican Web site (Outside Source).
Resources
Federal Education Grants Management: What Administrators Needs to Know. Thompson Publishing Group, Inc: 2007.
“Education Committee Republicans Call for Investigations of Waste, Fraud & Abuse in Federal Education Programs (Outside Source)," Committee on Education and Labor, News Update, May 28, 2008.
Budget and Farm Bill Top Congressional Agenda for June
When Congress returns from recess next week, the three biggest items on the agenda will be the supplemental appropriations bill, the joint budget resolution, and the Farm Bill. None of the legislation in question is expected to pass quickly or easily. Both the supplemental and the Farm Bill are expecting vetoes from President Bush. While the joint budget resolution does not require Presidential approval, it is still expected to receive very little, if any, support from the minority party. Between these three bills, Congress has a lot of work to finish before the July 4th recess.
The Senate passed its supplemental appropriations bill last week, setting up a second round of voting in the House, which passed its own version the previous week. The Senate bill consists of two separate amendments for domestic spending and funding for the wars in Iraq and Afghanistan. Democrats were able to pass both amendments with more than 70 votes each, giving them a solid veto-proof majority. The House passed its own supplemental, but failed to agree on the funding for Iraq and Afghanistan.
The domestic spending portion of the Senate bill, passed 75-22, and includes a moratorium on proposed Medicaid changes to payments for schools, as well as $400 million for a one-year extension of the Secure Rural Schools Act. The House passed a similar domestic spending package that includes the moratorium language, but not the rural schools funding. Once Congress reconvenes and the House passes the revised supplemental bill, the legislation still has to survive a likely veto from the White House, due to "excessive" domestic spending attached to the measure.
With the supplemental debate dragging on in both chambers, as well as clerical fiascos relating to the Farm Bill, Congress was again forced to push back work on a final joint budget resolution. The May 15th deadline under the Congressional Budget Act of 1974 passed weeks ago, but Congressional leaders are planning to take one final crack at it when the return next week. If there is not a final resolution by June 6th, appropriators are likely to begin deeming their own spending caps, just so they can finally begin work on fiscal year 2009 appropriations.
Aside from budget issues, Congress still needs to deal with the mess left behind by the failed Farm Bill effort. Of the 15 titles of the Farm Bill that Congress passed two weeks ago, only 14 made it to the President’s desk. The president vetoed the bill delivered to him, despite the missing title. Both the House and the Senate were able to override the President’s veto, but that only places 14 of the 15 titles as actual federal law, according to Senator Tom Harkin (D-IA). To avoid possible constitutional challenges to the manner in which the incomplete bill passed, the Senate plans to vote on a new package that the House passed last Thursday, which includes all 15 titles. The President will most likely veto the legislation a second time. Although both House and Senate votes demonstrate that there is enough support for an override, this will further delay the process, which cannot start up again until legislators return to Washington in June.
Resources
Vicki Needham, “The Agenda Ahead: Appropriations and Budget," Congress Now, May 30, 2008.
Supreme Court Rules in Two Workplace Retaliation Cases
Earlier this week, the Supreme Court ruled in two cases that employees who complained about workplace discrimination are protected from retaliation under two federal civil rights laws. While both of these statutes expressly prohibit race and age based discrimination, neither statute expressly mentions retaliation. The Court used the doctrine of stare decisis to construe the laws to include an implied anti-retaliation right.
In CBOCS West, Inc. v. Humphries, Hedrick G. Humphries, an African-American former assistant manager of a Cracker Barrel restaurant, filed suit under 42 U.S.C. § 1981, alleging that he was fired after complaining that another black employee was being discriminated against and was also dismissed for race-based reasons. The pertinent provision of Section 1981 gives, "[a]ll persons within the jurisdiction of the United States . . . the same right . . . to make and enforce contracts . . . as is enjoyed by white citizens."
As previously mentioned, the Court’s holdings are based largely upon principles of stare decisis. This principle means that courts are required to follow precedent, and base their decisions upon prior decisions. In CBOCS, the Court’s 7 to 2 ruling examined pertinent case law in which the Court interpreted civil rights statutes. These cases also found that Congress’ silence and failure to directly address retaliation when constructing these laws does not signal that Congress intended for these statutes to prohibit retaliation claims.
In Gómez-Pérez v. Potter, the Court held, in a 6 to 3 opinion, that federal workers are protected from retaliation under the Age Discrimination in Employment Act (ADEA). Myrna Gómez-Pérez, who was a 45-year-old postal worker at the time, claimed that her employer violated the Age Discrimination in Employment Act (ADEA) when, according to the plaintiff, she was subjected to various forms of retaliation after she was denied a transfer and filed a Postal Service equal employment opportunity complaint. The federal sector provision of the ADEA requires that "[a]ll personnel actions affecting employees . . . who are at least 40 years of age . . . shall be made free from any discrimination based on age." The key issue in this matter was whether the statute’s phrase, "discrimination based on age" included retaliation for filing an age based discrimination complaint.
Interestingly, the ADEA’s private sector provision has a separate anti-retaliation provision expressly written into the statute, while the public sector provision does not. This led to the question of how to interpret Congress’ silence in this one context of the statute. On one hand, Congress included a clear anti-retaliation provision within a different provision of the very same statute. On the other hand, as the Court reasoned, the federal sector provision of the ADEA was passed seven years after the private sector provision. In addition, the federal sector provision was not modeled after the private sector provision, but instead on Title VI’s prohibition against employment discrimination in the federal government. This led the Court to conclude that the general anti-discrimination laws contained a prohibition against retaliation.
However, Chief Justice Roberts’ could not overlook the statute’s inconsistency in his Gómez-Pérez dissent. While he was able to agree with the majority in CBOCS, and acknowledge that it is possible for a general anti-discrimination law to be construed to prohibit retaliation, he was not able to overcome the anti-retaliation provision expressly included in one part of the statute, but not the other. Instead, Roberts’s view was that Congress did not intend for federal employment retaliation claims to be dealt with judicially, but administratively, through executive orders which prohibit retaliation and are subject to enforcement by the civil service system. Justices Scalia and Thomas also dissented in both Gómez-Pérez and CBOCS.
The major crux of both CBOCS and Gómez-Pérez was whether prohibiting race- and age-based discrimination implies that employees are protected from retaliation. In both cases, the Court held that the anti-discrimination provisions can be read as prohibiting retaliation.
Rulemaking Pushback
The United States Department of Education (ED) is in the throes of final rulemaking. On April 23rd, ED published the anticipated notice of proposed rulemaking (NPRM) for Title I of the Elementary and Secondary Education Act (ESEA) and on May 2nd, ED published a notice of proposed interpretations (NPI) for ESEA Title III. While the name of the rulemaking varies (rule versus interpretation) both will likely have the force of legislative effect because the Administrative Procedure Act (APA) defines a “rule" so broadly that it will include almost any statement made by an agency, where the statute is not clear and Congress has delegated the authority to the agency, expressly or by implication.
Recognizing the significance of the agency rulemaking (that it will have the force of law), many are submitting comments in order to get their insights, approval or disapproval on record. But what if there is strong and uniform disapproval to a proposed rule? What can be done? There are three apparent courses of action.
First and most practical, stakeholders could document and quantify their grievances during the public comment period. The agency is required to review and respond to the comments and, if an opposing view is compelling enough, then the agency may have to adjust the proposed rule to accommodate the divergent comment.
Second, stakeholders could bring the matter to the attention of Congress. Congress has two opportunities to address the proposed rule. Members can propose legislation to slow or stop the rules. For example, in April the House passed House Resolution 5613, the Medicaid Safety Net Act, which places a one-year moratorium on the regulations proposed by the Center for Medicare and Medicaid Services (CMS) last year. (The Senate has yet to take up the matter, but that is for another article). Members of Congress can also exercise their authority under the Congressional Review Act (CRA), 5 U.S.C 801-808. This law requires all agencies promulgating a rule to submit a rule(s) report to each House of Congress and to the Comptroller General before the rule(s) may take effect. Congress then has a period of 60 days to review and adopt a resolution of disapproval. The drawback of working with Congress is, of course, the nature of Congress itself. Successful legislation requires bicameral approval and that, particularly in an election year, is almost always unreliable.
Finally, there is legal recourse. If the agency’s rule is "arbitrary and capricious," an aggrieved party could challenge the matter in court. The plaintiff, however, would have a difficult burden to overturn the regulation, as courts grant agency decisions considerable deference. The plaintiff would have to show that the rule is "arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law" under 5 U.S.C. § 706(2)(A). This would require a court to replace the judgment and expertise of an agency with its own - a hard sell, for sure.
Of the three courses of action, the first, submitting well-reasoned comments supported by strong, quantifiable data, is the most effective and reliable manner to change the course of proposed rulemaking.
Resources
Congressional Review of Agency Rulemaking: An Update and Assessment After Nullification of OSHA’s Ergonomics Standard (Congressional Research Service, RL30116: January 2003).
Reports
NCES Releases ‘Condition of Education 2008’
This week, the National Center for Education Statistics (NCES) released its annual report, “The Condition of Education." The Congressionally mandated report tries to paint a general picture of the state of public education in the United States, looking both at the demographic and achievement changes from previous years by looking at 43 different indicators. These indicators focus on participation and persistence in education, student performance and other measures of achievement, the environment for learning, and resources for education.
The Report found that enrollment in America’s public schools is rising to an all-time high, and the nation’s student body is becoming more diverse. According to the report, one in five public school students is Latino, but these students, as well as other minorities, are disproportionately clustered in high-poverty schools. More individuals of all races are enrolling in college and more bachelor’s degrees have been awarded than in the past. However, gaps in achievement and high school and college graduation rates between white and minority students continue.
Other noteworthy highlights from the annual report include:
- This year, public school enrollment is expected to approach about 50 million students. Total public school enrollment is projected to set new records each year from 2008 to 2017, at which time it is expected to reach 54.1 million.
- Minority students make up 43 percent of the public school enrollment overall and 48 percent in the South and 55 percent in the West.
- Twenty percent of school-age children speak a language other than English at home; about 5 percent speak English with difficulty.
- In 2005–06, about a third of Black students and a third of Hispanic students attended high-poverty schools compared with 4 percent of White students.
- Between 1989–90 and 2004–05, total spending per student in public elementary and secondary schools rose 29 percent after adjusting for inflation, to $10,892.
- Average reading scores of 4th and 8th graders were higher in 2007 than in 1992.
- Average mathematics scores increased 27 points for 4th-graders and 19 points for 8th-graders between 1990 and 2007.
- The dropout rates for Whites, Blacks, and Hispanics have generally declined between 1972 and 2006. However, over this period, the dropout rates for Hispanics and Blacks remained higher than the White rates.
- Among public high school students in the class of 2005, about three-fourths graduated on time.
- The rate of students entering college immediately after high school graduation increased from 49 percent in 1972 to 67 percent by 1997, but has since fluctuated between 62 and 69 percent.
- Since 1970, women’s undergraduate enrollment has increased over three times as fast as men’s. Currently, women make up 57 percent of undergraduate enrollment.
- Minority students have accounted for about half of the growth in associate’s and bachelor’s degrees awarded between 1989–90 and 2003–04.
- In 2006, young adults with a bachelor’s degree earned about $11,000 more than those with an associate’s degree, about $16,000 more than those who had completed high school, and more than twice as much than those who did not earn a high school diploma.
You can view additional resources, as well as the full report at the National Center for Education Statistics (Outside Source).
