Case Name: SCHOOL DISTRICT OF the CITY OF PONTIAC, et al., Plaintiffs-Appellants, v. SECRETARY OF the UNITED STATES DEPARTMENT OF EDUCATION, Defendant-Appellee
Court: United States Court of Appeals for the Sixth Circuit
Jurisdiction: United States
Decision Date: 2009-10-16
Citations: 584 F.3d 253
Docket Number: No. 05-2708
Parties: SCHOOL DISTRICT OF the CITY OF PONTIAC, et al., Plaintiffs-Appellants, v. SECRETARY OF the UNITED STATES DEPARTMENT OF EDUCATION, Defendant-Appellee.
Judges: Before: BATCHELDER, Chief Judge; MARTIN, BOGGS, DAUGHTREY, MOORE, COLE, CLAY, GILMAN, GIBBONS, ROGERS, SUTTON, COOK, McKEAGUE, GRIFFIN, KETHLEDGE, and WHITE, Circuit Judges.
Reporter: Federal Reporter 3d Series
Volume: 584
Pages: 253–313

Head Matter:
SCHOOL DISTRICT OF the CITY OF PONTIAC, et al., Plaintiffs-Appellants, v. SECRETARY OF the UNITED STATES DEPARTMENT OF EDUCATION, Defendant-Appellee.
No. 05-2708.
United States Court of Appeals, Sixth Circuit.
Argued: Dec. 10, 2008.
Decided and Filed: Oct. 16, 2009.
ARGUED: Robert H. Chanin, Bredhoff & Kaiser, P.L.L.C., Washington, D.C., for Appellants. Alisa B. Klein, United States Department of Justice, Washington, D.C., for Appellee. ON BRIEF: Robert H. Chanin, Jeremiah A. Collins, Bredhoff & Kaiser, P.L.L.C., Washington, D.C., Dennis R. Pollard, Thrum Law Firm, P.C., Bloomfield Hills, Michigan, Alice Margaret O’Brien, California Teachers Association, Burlingame, California, Philip A. Hostak, Office of General Counsel, National Education Association, Washington, D.C., for Appellants. Alisa B. Klein, Mark B. Stern, United States Department of Justice, Washington, D.C., for Appellee.
Before: BATCHELDER, Chief Judge; MARTIN, BOGGS, DAUGHTREY, MOORE, COLE, CLAY, GILMAN, GIBBONS, ROGERS, SUTTON, COOK, McKEAGUE, GRIFFIN, KETHLEDGE, and WHITE, Circuit Judges.

Opinion:
COLE, J., (pp. 256-278) delivered an opinion in favor of reversing the district court's judgment of dismissal, in which MARTIN, DAUGHTREY, MOORE, CLAY, GILMAN, and WHITE, JJ., joined, and in which GIBBONS, J., joined in part. SUTTON, J., (pp. 278-297) delivered a separate opinion concurring in the order affirming the district court's judgment, in which BATCHELDER, C.J., BOGGS, COOK, and KETHLEDGE, JJ., joined, and in which McKEAGUE, J., joined as to Part II only, with McKEAGUE, J., (pp. 297-310) also delivering a separate opinion concurring in affirming dismissal, in which ROGERS and GRIFFIN, JJ., joined as to Part II only. GIBBONS, J., (pp. 310-313) delivered a separate opinion in favor of reversing the judgment of the district court.
ORDER
This case was heard by the en banc court on December 10, 2008. The court, for the reasons more fully set forth in the opinions issued herewith, divided evenly, with eight judges voting to affirm the judgment of the district court and eight voting to reverse that judgment. Consequently, the judgment of the district court is AFFIRMED. See Goodwin v. Ghee, 330 F.3d 446 (6th Cir.2003), and Stupak-Thrall v. United States, 89 F.3d 1269 (6th Cir.1996).
IT IS SO ORDERED.
OPINION
COLE, Circuit Judge.
The controversy presently before this Court is neither particularly complicated nor inherently political. Understanding the precise question before us means understanding what this case does not present — namely, this case does not ask us to enter the political arena to judge the relative merits of the No Child Left Behind Act of 2001 ("NCLB" or "the Act"), 20 U.S.C. § 6301-7941. Also, this case has nothing to do with the ongoing debate between the various advocates of state versus federal educational funding. Rather, we need to answer only a straightforward question of statutory interpretation: Whether, analyzed under the Spending Clause of the United States Constitution, the obligations set forth in NCLB are unambiguous such that a state official would clearly understand her responsibilities under the Act.
Plaintiffs-Appellants are school districts and education associations (collectively, "Plaintiffs") that receive federal funding under NCLB in exchange for complying with the Act's various educational requirements and accountability measures. Based on the so-called "Unfunded Mandates Provision," which provides that "[njothing in this Act shall be construed to . mandate a State or any subdivision thereof to spend any funds or incur any costs not paid for under this Act," 20 U.S.C. § 7907(a), Plaintiffs filed suit in district court against the Secretary of the United States Department of Education (the "Secretary") seeking a declaratory judgment that they need not comply with the Act's requirements where doing so would result in increased costs of compliance not covered by federal funds. The district court concluded that Plaintiffs must comply with the Act's requirements regardless of any federal-funding shortfall and, accordingly, granted the Secretary's motion to dismiss the complaint for failure to state a claim upon which relief can be granted.
I. BACKGROUND
A. The No Child Left Behind Act
On January 8, 2002, then-President George W. Bush signed NCLB into law. The Act — "a comprehensive educational reform" — amended the Elementary and Secondary Education Act of 1965 ("ESEA"), Pub.L. No. 89-10, 79 Stat. 27 (codified as amended at 20 U.S.C. § 6301-7941 (2003)). See Connecticut v. Spellings, 453 F.Supp.2d 459, 468 (D.Conn.2006). The ESEA targeted funding to students in low-income schools, and its purposes included overcoming "any effects of past racial discrimination." George v. O'Kelly, 448 F.2d 148, 151 (5th Cir.1971); accord Barrera v. Wheeler, 475 F.2d 1338, 1340 (8th Cir.1973); United States v. Jefferson County Bd. of Educ., 372 F.2d 836, 851 (5th Cir.1966). The ESEA was periodically reauthorized and amended over the next few decades.
In contrast to prior ESEA iterations, NCLB "provides increased flexibility of funds, accountability for student achievement and more options for parents." 147 Cong. Rec. S13365, 13366 (2001) (statement of Sen. Bunning). The Act focuses federal funding more narrowly on the poorest students and demands accountability from schools, with serious consequences for schools that fail to meet academic-achievement requirements. Id. at 13366,13372 (statements of Sens. Bunning, Landrieu, and Kennedy). States may choose not to participate in NCLB and forgo the federal funds available under the Act, but if they do accept such funds, they must comply with NCLB requirements. See, e.g., 20 U.S.C. § 6311 ("For any State desiring to receive a grant under this part, the State educational agency shall submit to the Secretary a plan....") (emphasis added); see also Spellings, 453 F.Supp.2d at 469 ("In return for federal educational funds under the Act, Congress imposed on states a comprehensive regime of educational assessments and accountability measures."). In addition, with enumerated exceptions, under NCLB "the Secretary may waive any statutory or regulatory requirement . for a State educational agency, local educational agency, Indian tribe, or school through a local educational agency, that . receives funds under a program authorized by this Act." 20 U.S.C. § 7861(a).
Title I, Part A, of NCLB, titled "Improving Basic Programs Operated by Local Educational Agencies," continues to pursue the objectives of the ESEA and imposes extensive educational requirements on participating States and school districts, and, likewise, provides the largest amount of federal appropriations to participating States. For example, in fiscal year 2006, NCLB authorized $22.75 billion in appropriations for Title I, Part A, compared to $14.1 billion for the remaining twenty-six parts of NCLB combined. Title I, Part A's stated purposes include meeting "the educational needs of low-achieving children in our Nation's highest-poverty schools, limited English proficient children, migratory children, children with disabilities, Indian children, neglected or delinquent children, and young children in need of reading assistance." 20 U.S.C. § 6301(2).
In addition to Title I, Part A, NCLB establishes numerous other programs, including a literacy initiative for young children and poor families (Title I, Part B), special services for the education of children of migrant workers (Title I, Part C), requirements that all teachers be "highly qualified" (Title II, Part A), and instruction in English for children with limited English ability (Title III). Plaintiffs' com plaint focuses on the educational requirements and funding provisions of Title I, Part A.
To qualify for federal funding under Title I, Part A, States must first submit to the Secretary a "State plan," developed by the State's department of education in consultation with school districts, parents, teachers, and other administrators. 20 U.S.C. § 6311(a)(1). A State plan must "demonstrate that the State has adopted challenging academic content standards and challenging student academic achievement standards" against which to measure the academic achievement of the State's students. Id. § 6311(b)(1)(A). The standards in the State plan must be uniformly applicable to students in all of the State's public schools, and must cover at least reading or language arts; math; and, by the fourth grade, science skills. Id. § 6311(b)(1)(C).
States also must develop, and school districts must administer, assessments to determine students' levels of achievement under plan standards. Id. § 6311(b)(2)(A). These assessments must show the percentage of students achieving "proficiency" among "economically disadvantaged students," "students from major racial and ethnic groups," "students with disabilities," and "students with limited English proficiency." Id. § 6311(b)(2)(C)(v)(II). Schools and districts are responsible for making "adequate yearly progress" ("AYP") on these assessments, meaning that a minimum percentage of students, both overall and in each subgroup, must attain proficiency. 34 C.F.R. § 200.20(a)(1).
A school's failure to achieve AYP triggers other requirements of Title I, Part A. See 20 U.S.C. § 6316(b). If a school fails to make AYP for two consecutive years, it must be identified by the local educational agency for school improvement. 20 U.S.C. § 6316(b)(1)(A). Among other things, a school in improvement status must inform all of its students, including those who have been assessed as proficient, that they are permitted to transfer to any school within the district that has not been identified for school improvement. Id. § 6316(b)(l)(E)(i). The school also must develop a two-year plan setting forth extensive measures to improve student performance, including further education for teachers and possible before- or after-school instruction or summer instruction. Id. § 6316(b)(3)(A)(iii), (ix).
If a school does not achieve AYP after two years of improvement status, it is "identified] . for corrective action." Id. § 6316(b)(7)(C)(iv). Corrective action involves significant changes, such as replacing teachers who are "relevant to the failure to make [AYP]," or instituting an entirely new curriculum. Id. § 6316(b)(7)(C)(iv)(I). If, after a year of corrective action, a school still has not reached AYP, the district must restructure the school entirely; options for restructuring include "[r]eopening the school as a public charter school," replacing the majority of the staff, or allowing the State's department of education to run the school directly. Id. § 6316(b)(8)(B)(i).
The issue of who must pay to implement these requirements is the heart of this case. NCLB requires that States use federal funds made available under the Act "only to supplement the funds that would, in the absence of such Federal funds, be made available from non-Federal sources for the education of pupils participating in programs assisted under this part, and not to supplant such funds." 20 U.S.C. § 6321(b)(1). That is, States and school districts remain responsible for the majority of the funding for public education, and the funds distributed under Title I are to be used only to implement Title I pro gramming, not to replace funds already being used for general programming.
While Plaintiffs recognize that the majority of funding for education continues to come from state and local sources, they contend that NCLB does not require them to spend the money drawn from state and local sources on the additional programs required by NCLB. They point to § 7907(a), entitled "Prohibitions on Federal government and use of Federal funds," often referred to as the "Unfunded Mandates Provision," which provides that "[njothing in this Act shall be construed to . mandate a State or any subdivision thereof to spend any funds or incur any costs not paid for under this Act. 20 U.S.C. § 7907(a) (emphasis added). Plaintiffs argue that this section specifically exempts them from complying with NCLB's requirements where federal funding does not cover the additional costs of complying with those requirements. They further note that former Secretary of Education Rod Paige has explained that "[tjhere is language in the bill that prohibits requiring anything that is not paid for." (Pis.' Compl. for Declaratory and Injunctive Relief ("Compl.") 12; Joint Appendix ("JA") 21 (quoting Paige statement of Dec. 2, 2003).)
B. Procedural history
Plaintiffs brought suit in the United States District Court for the Eastern District of Michigan seeking a declaratory judgment that NCLB does not require school districts to comply with the Act's educational requirements if doing so would require the expenditure of state and local funds to cover the additional costs of compliance. In the alternative, the complaint alleged that the Act is ambiguous as to whether school districts are required to spend their own funds, and that imposing such a requirement would violate the Spending Clause.
Plaintiffs alleged that in the years following the enactment of NCLB, Congress has not provided States and school districts with sufficient federal funds to comply fully with the Act. For example, for the five years from fiscal year 2002 to fiscal year 2006, Congress appropriated $30.8 billion dollars less for Title I grants to school districts than it authorized in NCLB. (JA 27.) Plaintiffs sought a declaratory judgment stating that "states and school districts are not required to spend non-NCLB funds to comply with the NCLB mandates, and that a failure to comply with the NCLB mandates for this reason does not provide a basis for withholding any federal funds to which they otherwise are entitled under the NCLB." (JA 67.) Plaintiffs also sought an injunction prohibiting the Secretary from "withholding from states and school districts any federal funds to which they are entitled under the NCLB because of a failure to comply with the mandates of the NCLB that is attributable to a refusal to spend non-NCLB funds to achieve such compliance." (Id.)
The district court dismissed the complaint for failure to state a claim. The court focused on the first part of § 7907(a), which, for clarity, we restate in full below:
General prohibition. Nothing in this Act shall be construed to authorize an officer or employee of the Federal Government to mandate, direct, or control a State, local educational agency, or school's curriculum, program of instruction, or allocation of State or local resources, or mandate a State or any subdivision thereof to spend any funds or incur any costs not paid for under this Act.
20 U.S.C. § 7907(a) (emphasis added). The court concluded that "[b]y including the words 'an officer or employee of,' Congress clearly meant [merely] to prohibit federal officers and employees from imposing additional, unfunded requirements, beyond those provided for in the statute." Sch. Dist. of Pontiac v. Spellings, No. 05-CV-71535, 2005 U.S. Dist. LEXIS 29253, at *12, 2005 WL 3149545, at *4 (E.D.Mieh. Nov. 23, 2005). "This does not mean," the court explained, "that Congress could not [require States or school districts to spend any funds or incur any costs not paid for under this Act], which it obviously has done by passing the NCLB Act." Id. at *11, 2005 WL 3149545, at*4. In other words, the district court read § 7907(a) merely to prohibit federal officers and employees from imposing requirements that were not authorized by the Act on States and school districts, and rejected Plaintiffs' argument that § 7907(a) excuses compliance with requirements of the Act that impose additional costs on the States not funded by the federal government.
Plaintiffs appealed. In a divided, published opinion, the panel below reversed the judgment of the district court. Pontiac Sch. Dist. v. Sec'y of U.S. Dep't of Educ., 512 F.3d 252, 254 (6th Cir.2008) (vacated). That decision found that Plaintiffs had standing to bring suit and that NCLB failed to provide clear notice to States as required by the Spending Clause. Id. at 259, 261. The panel majority concluded that based on the text of § 7907(a), NCLB failed to provide clear notice because a state official could plausibly conclude that the State need not comply with those NCLB requirements that were not covered by federal funding. Id. at 269.
On May 1, 2008, a majority of judges of this Court voted to rehear the case en banc, vacating the panel's opinion and restoring this case to the docket as a pending appeal.
II. DISCUSSION
A. Justiciability
A threshold question is whether this case is properly before us. As we have previously explained, "[a] claim is not 'amenable to . the judicial process,' Steel Co. v. Citizens for a Better Env't, 523 U.S. 83, 102, 118 S.Ct. 1003, 140 L.Ed.2d 210[] (1998), when it is filed too early (making it unripe), when it is filed too late (making it moot) or when the claimant lacks a sufficiently concrete and redressable interest in the dispute (depriving the plaintiff of standing)." Warshak v. United States, 532 F.3d 521, 525 (6th Cir.2008) (en banc). This controversy implicates two of these doctrines — standing and ripeness.
1. Standing
First, we must decide whether Plaintiffs have standing to challenge NCLB under the Spending Clause. We review the question of standing de novo. Sandusky County Democratic Party v. Blackwell, 387 F.3d 565, 573 (6th Cir.2004). Plaintiffs, as the parties now asserting federal jurisdiction, have the burden of establishing standing. DaimlerChrysler Corp. v. Cuno, 547 U.S. 332, 342 n. 3, 126 S.Ct. 1854, 164 L.Ed.2d 589 (2006). To satisfy the constitutional requirement of standing,
a plaintiff must show (1) it has suffered an "injury in fact" that is (a) concrete and particularized and (b) actual or imminent, not conjectural or hypothetical; (2) the injury is fairly traceable to the challenged action of the defendant; and (3) it is likely, as opposed to merely speculative, that the injury will be redressed by a favorable decision.
Friends of the Earth, Inc. v. Laidlaw Envtl. Servs., Inc., 528 U.S. 167, 180-81, 120 S.Ct. 693, 145 L.Ed.2d 610 (2000) (citing Lujan v. Defenders of Wildlife, 504 U.S. 555, 560-61, 112 S.Ct. 2130, 119 L.Ed.2d 351 (1992)). The injury suffered must be "an invasion of a legally protected interest." United States v. Hays, 515 U.S. 737, 743, 115 S.Ct. 2431, 132 L.Ed.2d 635 (1995). This tripartite standing requirement applies to claims under NCLB. See Ctr. for Law & Educ. v. Dep't of Educ., 396 F.3d 1152, 1157 (D.C.Cir.2005) (citing Lujan, 504 U.S. at 560-61, 112 S.Ct. 2130).
Here, because the district court dismissed the complaint at the pleading stage, the assessment of standing is confined to the allegations in the complaint. "At the pleading stage, general factual allegations of injury resulting from the defendant's conduct may suffice"; more is required to defeat a motion for summary judgment, and even more is required for a decision on the merits. Lujan, 504 U.S. at 561, 112 S.Ct. 2130.
We conclude that the school district Plaintiffs meet the three requirements for standing based on their allegation that they must spend state and local funds to pay for NCLB compliance. Since at least one Plaintiff in this action has standing, there is no need to consider whether the education association Plaintiffs also have standing. See Clinton v. City of N.Y., 524 U.S. 417, 431 n. 19, 118 S.Ct. 2091, 141 L.Ed.2d 393 (1998); Bowsher v. Synar, 478 U.S. 714, 721, 106 S.Ct. 3181, 92 L.Ed.2d 583 (1986). Additionally, we need not address whether the school district Plaintiffs' other alleged injuries are sufficient to establish standing. See Nuclear Energy Inst., Inc. v. EPA, 373 F.3d 1251, 1266 (D.C.Cir.2004) (finding standing where, although one alleged injury might not occur "for thousands of years," another injury allegedly would occur very soon).
a. Injury in fact
School district Plaintiffs allege that they must spend state and local funds to pay for NCLB compliance:
Because of the multi-billion dollar national funding shortfalls of NCLB, and the insistence by [the Secretary] that . school districts comply fully with all of the NCLB mandates imposed upon them even if NCLB funds that they receive are insufficient to pay for such compliance, . school districts have had and will have to spend a substantial amount of non-NCLB funds to comply with those mandates, diverting those funds from other important educational programs and priorities, such as programs for gifted and talented students, courses in foreign languages, art, music, computers, and other non-NCLB subjects, class size reduction efforts, and extracurricular activities.
(JA 61-62.) They also allege that if they do not comply with all NCLB requirements, the districts "face the withholding [by the Secretary] of federal funds to which they otherwise are entitled under the NCLB." (JA 65.) Additionally, the school district Plaintiffs claim that inadequate federal funding has caused low rates of student proficiency on standardized tests.
The Secretary consistently has maintained that the school district Plaintiffs must comply with NCLB requirements even if they must spend non-federal funds to do so. School district Plaintiffs allege that the Secretary's insistence that school districts comply fully with NCLB has already forced them to spend state and local funds on NCLB requirements and will continue to require such expenditures in the future. Because this injury already has occurred and is ongoing, it is concrete and actual.
Moreover, the alleged ongoing need of school district Plaintiffs to spend nonfederal funds to comply with NCLB requirements is not dependent on the hypothetical actions of "decisions made by the appropriate [state] authorities, who are not parties to this case." Warth v. Seldin, 422 U.S. 490, 509, 95 S.Ct. 2197, 45 L.Ed.2d 343 (1975) (holding that city of Rochester taxpayers could not sue the town of Penfield on the theory that Penfíeld's zoning practices would increase Rochester taxes, because Rochester was not a party). That is, under NCLB, States do not have the discretion to decide that, in the event of a federal-funding shortfall, some districts will continue to receive their previous level of funding and others will not. Instead, under NCLB, state departments of education "shall" allocate federal NCLB funds to counties or school districts based on formulas provided in NCLB and approved by the Secretary. 20 U.S.C. § 6333(a)(3)(C). Thus, the "injury in this case . does not turn on the independent actions of third parties," but on NCLB's funding requirements, which dictate the quantum of funding provided to each school district. Clinton, 524 U.S. at 431 n. 19, 118 S.Ct. 2091. To the extent the funding received by the school district Plaintiffs under NCLB is insufficient to defray the cost of compliance with NCLB requirements, the districts have sustained a cognizable injury in fact.
b. Traceability
School district Plaintiffs' obligation to spend non-federal funds to comply with NCLB is traceable to the challenged action of the Secretary. The Secretary has interpreted NCLB to mean that "'[i]f a state decides to accept the federal funds [offered under the NCLB], then it's required to implement the law in its entirety.' " (Compl. 12; JA 21 (quoting Rodney Paige, Sec'y, U.S. Dep't of Educ., Remarks to National Urban League (Mar. 25, 2004)) (alterations in original).) And, the Secretary has not granted waivers of NCLB educational requirements based on the insufficiency of federal funding. Therefore, school district Plaintiffs alleged that the spending of non-federal funds to comply with NCLB requirements is directly traceable to the Secretary's interpretation of NCLB.
c. Redressability
Finally, school district Plaintiffs' injury must be redressable by a favorable decision. Among other relief, Plaintiffs seek a declaratory judgment that "school districts are not required to spend non-NCLB funds to comply with the NCLB mandates." (JA 67.) Such a judgment would forbid the Secretary from requiring the expenditure of non-federal funds on NCLB compliance. This would redress the injury alleged by Plaintiffs.
2. Ripeness
Next, we must decide whether Plaintiffs' challenge to NCLB is ripe for judicial review. This Court reviews questions of ripeness de novo. Ammex, Inc. v. Cox, 351 F.3d 697, 706 (6th Cir.2003). "In ascertaining whether a claim is ripe for judicial resolution, we ask two basic questions: (1) is the claim 'fit[ ] . for judicial decision' in the sense that it arises in a concrete factual context and concerns a dispute that is likely to come to pass? and (2) what is 'the hardship to the parties of withholding court consideration'?" Warshak, 532 F.3d at 525 (quoting Abbott Labs. v. Gardner, 387 U.S. 136, 149, 87 S.Ct. 1507, 18 L.Ed.2d 681 (1967)) (alternations in original).
This case is ripe for judicial review. In discussing ripeness, this Court aptly has provided both that "the basic rationale of the ripeness doctrine 'is to prevent the courts, through premature adjudication, from entangling themselves in abstract disagreements,' " Nat'l Rifle Ass'n of Am. v. Magaw, 132 F.3d 272, 284 (6th Cir.1997) (quoting Thomas v. Union Carbide Agric. Prods. Co., 473 U.S. 568, 580, 105 S.Ct. 3325, 87 L.Ed.2d 409 (1985)), and that "[rjipeness becomes an issue when a case is anchored in future events that may not occur as anticipated, or at all." Id. (citations omitted). These concerns are not present here. The question before this Court is neither abstract nor hypothetical. Plaintiffs present a straightforward, concrete question of statutory interpretation, the answer to which is not dependent on further development of facts or further administrative action. See Warshak, 532 F.3d at 528 (explaining that legal questions that are answered "differently in different settings" lack fitness for review). In short, unless we decide this matter, school district Plaintiffs will be forced to continue expending limited state resources to comply with NCLB.
a. Fitness
There is no doubt that Congress has not fully funded the cost of complying with NCLB, and school district Plaintiffs assert that they are forced to spend non-federal monies to comply with NCLB— meaning this dispute over school funding is unquestionably "likely to come to pass." Plaintiffs assert that they already have suffered injury in the expenditure of nonrefundable, non-federal dollars in pursuit of compliance with the NCLB. Thus, we need not concern ourselves with the hypothetical, as Plaintiffs are prepared to establish actual ongoing harm.
Similarly, Plaintiffs have demonstrated that their claims arise in a concrete factual context. Simply, we are asked whether under the plain language of NCLB, when the Act is considered in parallel with the Spending Clause, the Secretary may require States to expend non-federal monies. We are not being asked to invalidate the law or to apply NCLB to any particular set of factual circumstances in which we would benefit from further administrative developments. We must decide only— through traditional techniques of statutory interpretation — whether NCLB complies with the clear-notice requirements of the Spending Clause.
b. Hardship
This dispute falls within the traditional conception of a "hardship" case— namely, a "claimant who faces a choice between immediately complying with a burdensome law or 'risk[ing] serious criminal and civil penalties.' " Warshak, 532 F.3d at 531 (quoting Abbott Labs., 387 U.S. at 149, 87 S.Ct. 1507) (alterations in original).
We see no reason to depart from the jurisprudence that "where a regulation requires an immediate and significant change in the plaintiffs' conduct of their affairs with serious penalties attached to noncompliance, hardship has been demonstrated." Suitum v. Tahoe Reg'l Plan ning Agency, 520 U.S. 725, 743-44, 117 S.Ct. 1659, 137 L.Ed.2d 980 (1997) (internal quotation marks omitted). Here, school district Plaintiffs must decide between drastic budget reallocation to comply with NCLB and serious statutory consequences, including teacher replacement, school restructuring, school closure and reopening as a charter school, or having schools run by the State's department of education. See 20 U.S.C. § 6316(b)(7)(C)(iv), (b)(8)(B).
B. Federal Rule of Civil Procedure 19
My colleague Judge McKeague argues that this case must be dismissed under Federal Rule of Civil Procedure 19 because absent parties are necessary to this litigation. McKeague Op. 300-09. Specifically, Judge McKeague contends that the States of Michigan, Texas, and Vermont are required parties to this litigation incapable of joinder and that any relief granted in their absence would be incomplete. McKeague Op. 302-05. However, this reasoning is not supported by the text of Rule 19 or the relevant case law. Moreover, such a broad interpretation of Rule 19 could have the undesirable effect of foreclosing a vast category of legitimate challenges to federal laws.
1. The text of Rule 19
Under Federal Rule of Civil Procedure 19, "whether a party is indispensable for a just adjudication requires a determination regarding whether the absent party is necessary to the litigation; if so, whether the absent party can be joined in the litigation; and if joinder is infeasible, whether the lawsuit can nevertheless proceed 'in equity and good conscience.'" Kickapoo Tribe v. Babbitt, 43 F.3d 1491, 1494 (D.C.Cir.1995) (quoting former Fed.R.Civ.P. 19 and citing W. Md. Ry. Co. v. Harbor Ins. Co., 910 F.2d 960, 961 (D.C.Cir.1990)). An absent party is required for a litigation if:
(A) in [the party's] absence, the court cannot accord complete relief among existing parties; or
(B) that [party] claims an interest relating to the subject of the action and is so situated that disposing of the action in the [party's] absence may:
(i) as a practical matter impair or impede the [party's] ability to protect the interest; or
(ii) leave an existing party subject to a substantial risk of incurring double, multiple, or otherwise inconsistent obligations because of the interest.
Fed.R.Civ.P. 19(a)(1). If an absent required party cannot be joined in the lawsuit, Rule 19 provides that:
the court must determine whether, in equity and good conscience, the action should proceed among the existing parties or should be dismissed. The factors for the court to consider include:
(1) the extent to which a judgment rendered in the [party's] absence might prejudice that [party] or the existing parties;
(2) the extent to which any prejudice could be lessened or avoided by:
(A) protective provisions in the judgment;
(B) shaping the relief; or
(C) other measures;
(3) whether a judgment rendered in the [party's] absence would be adequate; and
(4) whether the plaintiff would have an adequate remedy if the action were dismissed for nonjoinder.
Fed.R.Civ.P. 19(b). Our analysis involves two steps: first, we must examine whether the States of Michigan, Texas, and Vermont (the "States") are required parties; second, we must determine whether, in their absence, equity and good conscience require the case to be dismissed. If the answer to either question is no, then Rule 19 does not foreclose this litigation.
Under Rule 19(a), we first determine whether this Court can "accord complete relief among existing parties" in the States' absence. Fed.R.Civ.P. 19(a)(1)(A). "Completeness is determined on the basis of those persons who are already parties, and not as between a party and the absent person whose joinder is sought." Angst v. Royal Maccabees Life Ins. Co., 77 F.3d 701, 705 (3d Cir.1996) (citing Sindia Expedition, Inc. v. Wrecked & Abandoned Vessel, 895 F.2d 116, 121 (3d Cir.1990) and quoting 3A Moore's Federal Practice 19.07-11 at 93-98 (2d ed.1989) (internal quotations omitted in original)); see also United States v. County of Arlington, 669 F.2d 925, 929 (4th Cir.1982); Eldredge v. Carpenters 46 N. Cal. Counties Joint Apprenticeship & Training Comm., 662 F.2d 534, 537 (9th Cir.1981). Here, neither Plaintiffs nor the Secretary would receive incomplete relief without the States as parties. As will be discussed in detail below, the issue arising between Plaintiffs and the Secretary is whether NCLB provides the clear notice required under the Spending Clause. If NCLB fails to provide clear notice, this Court may uphold the Plaintiffs' interpretation of § 7907(a), thus preventing the forced expenditure of non-NCLB funds. If NCLB provides clear notice, this Court may uphold the Secretary's interpretation. Such declaratory relief for either side is complete relief and does not require joinder of the States.
While it is true that both statewide plans and district plans may need to be amended following the disposition of this case, NCLB itself contemplates periodic review of these plans and the submission of revisions to the Secretary as necessary. See 20 U.S.C. § 6311(a), (f). Such administrative actions have no bearing on the completeness of the requested declaratory relief. Moreover, even if some future litigation were likely between Plaintiffs or the Secretary and the States, the "possibility that the successful party to the original litigation would have to defend its rights in a subsequent suit by the [absent party] does not make it a necessary party to the action." Angst, 77 F.3d at 705 (citing Sindia, 895 F.2d at 122); see also MasterCard Int'l, Inc. v. Visa Int'l Serv. Ass'n, Inc., 471 F.3d 377, 385 (2d Cir.2006) ("While there is no question that further litigation [involving an absent party] is inevitable if MasterCard prevails in this lawsuit, Rule 19(a)(1) is concerned only with those who are already parties."); LLC Corp. v. Pension Benefit Guar. Corp., 703 F.2d 301, 305 (8th Cir.1983) (determining that Rule 19(a)(1)(A) applies to current parties, "not [to] the speculative possibility of further litigation between a party and an absent person"). "Rule 19 calls for a pragmatic approach; simply because some forms of relief might not be available due to the absence of certain parties, the entire suit should not be dismissed if meaningful relief can still be accorded." Smith v. United Bhd. of Carpenters & Joiners of Am., 685 F.2d 164, 166 (6th Cir.1982); see also Bank of Am. Nat'l Trust & Sav. Ass'n v. Hotel Rittenhouse Assocs., 844 F.2d 1050, 1054 n. 5 (3d Cir.1988) ("We observe that the advisory committee note to Rule 19(a) indicates that the question of 'complete relief may not denote final adjudications of all claims between the parties, so long as the relief actually afforded to the parties in the action is meaningful."). Regardless of the presence or absence of Michigan, Texas, or Vermont in this case, the declaratory relief this Court can provide is meaningful and complete, and we thus conclude that the States are not required parties under 19(a)(1)(A).
Notwithstanding this determination, the States still may be required under Rule 19(a)(1)(B). Rule 19(a)(l)(B)(i) exists to protect absentee parties, asking the Court to consider whether disposing of the matter in the parties' absence would "impair or impede the [parties'] ability to protect the interest." Fed.R.Civ.P. 19(a)(1)(B)®. We find that resolving this dispute does not impair or impede such an interest. First, the States do not have an obvious interest in this dispute that requires protection. In general, under NCLB, the States act as intermediaries through which federal funds flow to local schools to fund NCLB initiatives. Accordingly, the States' interests do not readily align with either the Plaintiffs' or the Secretary's interpretation of NCLB in this Spending Clause dispute. Because no party has articulated an interest unique to the States and because we are disinclined to speculate as to the existence of such interests, there simply is no basis on which to find that the States possess an interest requiring its participation.
Second, even if the States have a particular interest in this dispute, they had the opportunity to intervene to protect that interest but declined to participate. Had Michigan, Texas, or Vermont sought intervention, there is little doubt that this Court would have allowed each State to join as an intervenor. See Jansen v. City of Cincinnati, 904 F.2d 336, 342 (6th Cir.1990) ("We join other circuits in holding that the possibility of adverse stare decisis effects provides intervenors with sufficient interest to join an action."). Moreover, the States could have provided the Court with arguments as to their interests without jeopardizing sovereign immunity by appearing as amici curiae. However, it would turn Rule 19 analysis on its head to argue that the States' interests are now impaired because they declined to participate in this much-publicized case.
Last, we believe that the States' interests, if they have any, are adequately represented by the existing parties. See Republic of the Philippines v. Pimentel, — U.S. —, 128 S.Ct. 2180, 2189, 171 L.Ed.2d 131 (2008) (stating that parties "are required entities because [wjithout them . their interests in the subject matter are not protected") (alterations in original); see also Ohio Valley Envtl. Coal. v. Bulen, 429 F.3d 493, 504-05 (4th Cir.2005) (determining that absentees were not necessary parties when their interests were identical to those of existing parties who were capable of adequately representing the absentees' interests); Washington v. Daley, 173 F.3d 1158, 1167-68 (9th Cir.1999) (concluding, in a challenge to fishing regulations, that the United States adequately represented tribes who were, therefore, not necessary parties); see also Rochester Methodist Hosp. v. Travelers Ins. Co., 728 F.2d 1006, 1016 (8th Cir.1984) (reasoning that the Department of Health & Human Services ("HHS") was not a necessary party under Fed.R.Civ.P. 19(a)(1)(B)® because its interests were adequately protected by the United States Attorney who would make "every argument that HHS would or could make"). For these reasons, the States are not required parties under Rule 19(a)(1)(B)®.
Finally, in examining if the States are required parties under the text of Rule 19, we must consider whether disposing of this action without the States would "leave an existing party subject to a substantial risk of incurring double, multiple, or otherwise inconsistent obligations because of the interest." Here, no such risk exists. In fact, the opposite is true. Judicial economy is served, and the threat of inconsistent obligations is reduced, by deciding the present controversy because the existing parties as well as absent parties then will be aware of their rights and responsibilities under NCLB. Thus, under Rule 19(a)(l)(B)(ii), we conclude that the States are not required parties.
2. Relevant Rule 19 case law
There is little precedent supporting the broad reading of Rule 19 urged by my colleague. In the closest case, Kickapoo Tube, the D.C. Circuit concluded that Kansas was an indispensable party under Rule 19 and remanded to the district court with instructions to dismiss the case. 43 F.3d at 1500. The lawsuit filed by the Kickapoo Tribe against the Secretary of the Interior sought to invalidate a compact approved by the Secretary under the Indian Gaming Regulatory Act ("Gaming Act"). Id. at 1493-94. However, that case presented an entirely different challenge from the one at hand. Rather than challenging the federal Gaming Act, the Kickapoo Indians challenged a compact made between the Kickapoo Indians and the State of Kansas, and the case involved a question of the Kansas Governor's authority under Kansas law to sign the compact. Id. at 1494. There, it was clear that Kansas had an interest both in the compact and in the Governor's authority under Kansas law. Here, the States possess no similar interest in the interpretation of NCLB, nor is there any challenge to the States' authority to administer their educational programs under state law. With Kickapoo Tribe distinguished, there is no support for extending Rule 19 to the case before us. In fact, we are unable to find a single case in which a court of appeals has dismissed a challenge to the interpretation of a federal statute because a relevant State could not be joined.
On the other hand, many federal laws requiring state administration and implementation have been challenged without participation by the relevant States. For example, the recent Supreme Court cases of Forest Grove School District v. T.A., — U.S. —, 129 S.Ct. 2484, 174 L.Ed.2d 168 (2009), Winkelman v. Parma City School District, 550 U.S. 516, 127 S.Ct. 1994, 167 L.Ed.2d 904 (2007), and Arlington Central School District Board of Education v. Murphy, 548 U.S. 291, 126 S.Ct. 2455, 165 L.Ed.2d 526 (2006), all involved challenges similar to this case (albeit to the Individuals with Disabilities Education Act ("IDEA")), in which, as Judge McKeague acknowledged, the Court "issued holdings that were not only binding on the parties, but also, for all practical purposes, binding as precedent on the respective States" yet none of those cases was dismissed under Rule 19. McKeague Op. 307. Similarly, the Supreme Court has decided environmental cases involving challenges to the interpretation of federal statutes administered, in part, by the States without requiring state participation. See, e.g., Envtl. Def. v. Duke Energy Corp., 549 U.S. 561, 127 S.Ct. 1423, 167 L.Ed.2d 295 (2007) (interpreting the federal Clean Air Act without North Carolina's participation); S. Fla. Water Mgmt. Dist. v. Miccosukee Tribe of Indians, 541 U.S. 95, 124 S.Ct. 1537, 158 L.Ed.2d 264 (2004) (interpreting the federal Clean Water Act without Florida's participation). Thus, under Rule 19, a State's participation is not required simply because the case's outcome might affect the State.
S. Policy
To hold that Rule 19 requires the States' joinder in this case would greatly expand the class of required or necessary parties under the Rule. Making the States required parties in this litigation and ultimately dismissing this action would have the undesirable effect of foreclosing a vast category of challenges to federal laws — namely, any challenge to a federal statute where a State plays a role in the administration of the statute and possesses an interest in its administration, but chooses not to join the lawsuit. Under my colleague's reasoning, all pending and future NCLB and IDEA challenges in this Circuit would be foreclosed. Such an interpretation would also provide strong precedent for the dismissal of pending and future challenges regarding environmental, transportation, and other Spending-Clause suits, if the relevant States choose not to participate. This cannot be the intended purpose or effect of Rule 19.
While the States may have an interest in the outcome of this case, that is not enough. To be considered required parties, Michigan, Texas, and Vermont must fall within either of Rule 19's two categories. They do not. The States are simply not required parties under Rule 19, and their joinder is unnecessary for the continuation of this lawsuit.
C. The clear-notice requirement under the Spending Clause
Under the Spending Clause, "Congress has broad power to set the terms on which it disburses federal money to the States." Arlington, 548 U.S. at 296, 126 S.Ct. 2455 (citing South Dakota v. Dole, 483 U.S. 203, 206-07, 107 S.Ct. 2793, 97 L.Ed.2d 171 (1987)). "[B]ut when Congress attaches conditions to a State's acceptance of federal funds, the conditions must be set out 'unambiguously.' " Id. (citing Pennhurst State Sch. & Hosp. v. Halderman, 451 U.S. 1, 17, 101 S.Ct. 1531, 67 L.Ed.2d 694 (1981) and Bd. of Educ. v. Rowley, 458 U.S. 176, 204 n. 26, 102 S.Ct. 3034, 73 L.Ed.2d 690 (1982)). Legislation enacted under " 'the spending power is much in the nature of a contract,' and therefore, to be bound by 'federally imposed conditions,' recipients of federal funds must accept them 'voluntarily and knowingly.' " Id. (quoting Pennhurst, 451 U.S. at 17, 101 S.Ct. 1531). "States cannot knowingly accept conditions of which they are 'unaware' or which they are 'unable to ascertain.' " Id. (quoting Pennhurst, 451 U.S. at 17, 101 S.Ct. 1531). "By insisting that Congress speak with a clear voice," the Supreme Court enables States "to exercise their choice knowingly, cognizant of the consequences of their participation." Pennhurst, 451 U.S. at 17, 101 S.Ct. 1531. Moreover, "in those instances where Congress has intended the States to fund certain entitlements as a condition of receiving federal funds, it has proved capable of saying so explicitly." Id. at 17-18, 101 S.Ct. 1531.
In Pennhurst, the Supreme Court applied these principles to conclude that States participating in the Developmentally Disabled Assistance and Bill of Rights Act of 1975 ("DDA"), 42 U.S.C. § 6000-81, were not required to assume the costs of providing certain treatment and services to mentally disabled citizens. 451 U.S. at 5, 101 S.Ct. 1531. The DDA provided financial assistance to participating States to aid them in creating programs to care for and treat the mentally disabled. Id. at 11, 101 S.Ct. 1531. The DDA also included a variety of requirements for the receipt of federal funds, such that the States submit a plan to the Secretary of the Department of Health and Human Services to evaluate the services provided under the DDA. Id. at 12, 101 S.Ct. 1531. At the heart of the case was the DDA's "bill of rights" provision, which provided that mentally disabled citizens "have a right to appropriate treatment, services, and habili-tation for such disabilities" to be provided "in the setting that is least restrictive of the person's personal liberty." Id. at 13, 101 S.Ct. 1531. The plaintiffs, certain disabled citizens of Pennsylvania (a participant in the DDA), sued their state-owned institution to enforce these "rights"; that is, to compel Pennsylvania to pay for the costs of the services promised by the "bill of rights." Id.
The Supreme Court held, however, that the language in the DDA's "bill of rights" provision did not create enforceable obligations on the State. Id. at 22, 101 S.Ct. 1531. The Court explained that the provision's terms, "when viewed in the context of the more specific provisions of the Act, represent general statements of federal policy, not newly created legal duties." Id. at 22-23, 101 S.Ct. 1531. The Court also noted that the Act's "plain language" supported this view. Id. at 23, 101 S.Ct. 1531. It stated that "[w]hen Congress intended to impose conditions on the grant of federal funds," as it did in other sections of the DDA, "it proved capable of doing so in clear terms," by, for example, using the term "conditioned." Id. The "bill of rights" section, "in marked contrast, in no way suggested] that the grant of federal funds [was] 'conditioned' on a State's funding the rights described therein." Id. The Court further explained that the federal Government had no authority under the DDA to withhold funds from States for failing to comply with the "bill of rights" section. Id. Accordingly, that section could "hardly be considered a 'condition' of the grant of federal funds." Id. The Court also explained that the funds Congress provided to Pennsylvania under the DDA were "woefully inadequate to meet the enormous financial burden of providing 'appropriate' treatment in the 'least restrictive' setting." Id. at 24, 101 S.Ct. 1531. This confirmed that "Congress must have had a limited purpose in enacting" this provision because Congress "usually makes a far more substantial contribution to defray costs" when it "impose[s] affirmative obligations on the States." Id. "It defies common sense," the Court reasoned, "to suppose that Congress implicitly imposed this massive obligation on participating States." Id.
The Court reiterated that "Congress must express clearly its intent to impose conditions on the grant of federal funds so that the States can knowingly decide whether or not to accept those funds." Id. "That canon," the Court continued, "applies with greatest force where, as here, a State's potential obligations under the Act are largely indeterminate." Id. "The crucial inquiry, however, is not whether a State would knowingly undertake that obligation, but whether Congress spoke so clearly that we can fairly say that the State could make an informed choice." Id. at 25, 101 S.Ct. 1531 (emphasis added). Thus, the Court concluded that "Congress fell well short of providing clear notice to the States that they, by accepting funds under the Act, would indeed be obligated to comply with" the "bill of rights" provision in the DDA. Id.
The Supreme Court applied these principles again in Arlington, where a similar question arose under the IDEA, 20 U.S.C. § 1400 et. seq. Arlington, 548 U.S. at 296-300, 126 S.Ct. 2455. Enacted under the Spending Clause, the IDEA "provides federal funds to assist state and local agencies in educating children with disabilities and conditions such funding upon a State's compliance with extensive goals and procedures." Id. at 295, 126 S.Ct. 2455 (internal quotation marks and citation omitted). The plaintiffs in Arlington sued under the IDEA on behalf of their son to require the Arlington Board of Education to pay for their son's private-school tuition for specified school years. Id. at 294, 126 S.Ct. 2455. The plaintiffs prevailed in the district court, and the Second Circuit affirmed. Id. As the prevailing parties, the plaintiffs then sought fees for the services of an educational consultant who assisted them throughout the litigation. Id. Central to the dispute in Arlington was the IDEA'S provision that a court " 'may award reasonable attorneys' fees as part of the costs' " to parents who prevail in an action brought under the Act. Id. at 297, 126 S.Ct. 2455 (quoting 20 U.S.C. § 1415(i)(3)(B)).
Noting that "resolution of the question presented in this case is guided by the fact that Congress enacted the IDEA pursuant to the Spending Clause," the Supreme Court ultimately held that the plaintiffs were not entitled to the expert fees requested. Id. at 295, 126 S.Ct. 2455. The Court reaffirmed Pennhurst's principle requiring clear notice to States of their obligations under such legislation and explained how that principle should be applied: The Court "must view the IDEA from the perspective of a state official who is engaged in the process of deciding whether the State should accept IDEA funds and the obligations that go with those funds." Id. The Court "must ask whether such a state official would clearly understand that one of the obligations of the Act is the obligation to compensate prevailing parents for expert fees." Id. "In other words," the Court continued, "we must ask whether the IDEA furnishes clear notice regarding the liability at issue in this case." Id.
Applying these principles, the Court first considered the text of the IDEA. Id. The Court noted that it has "stated time and again that courts must presume that a legislature says in a statute what it means and means in a statute what it says there." Id. (internal quotation marks and citation omitted). The Court then explained that, although the IDEA fee provision "provides for an award of 'reasonable attorneys' fees,' this provision does not even hint that acceptance of IDEA funds makes a State responsible for reimbursing prevailing parents for services rendered by experts." Id. at 297, 126 S.Ct. 2455. Accordingly, the Court rejected the plaintiffs' argument that, because expert fees amounted to "costs" in IDEA proceedings and because the provision allowed for reasonable attorneys' fees "as part of the costs," the plaintiffs were entitled to expert fees. Id. at 297-98, 126 S.Ct. 2455. The Court explained that the provision "certainly fails to provide the clear notice that is required under the Spending Clause." Id. at 298, 126 S.Ct. 2455. The Court then explained that other provisions of the IDEA supported this view of the text. Id. at 298-301, 126 S.Ct. 2455. For example, the IDEA includes detailed provisions to ensure that attorneys' fees are reasonable, but lacks comparable provisions regarding expert fees. Id. at 298, 126 S.Ct. 2455. Additionally, the Court concluded that its holding was consistent with prior cases addressing the definitions of costs and fees. Id. at 301-02, 126 S.Ct. 2455.
The Court remained unswayed in this conclusion even in light of evidence that Congress intended the opposite interpretation of the expert-fees provision. The plaintiffs noted that Congress approved a Conference Report stating that "[t]he conferees intendfed] .that the term 'attorneys' fees as part of the costs' include[s] reasonable expenses and fees of expert witnesses...." Id. at 304, 126 S.Ct. 2455 (quoting H.R. Conf. Rep. No. 99-687, at 5 (1986)). "No Senator or Representative voiced any opposition to this statement in the discussion preceding the vote on the Conference Report — the last vote on the bill before it was sent to the President." Id. at 309, 126 S.Ct. 2455 (Souter, J., dissenting). The Court responded that, "[u]nder these circumstances, where everything other than the legislative history overwhelmingly suggests that expert fees may not be recovered, the legislative history is simply not enough." Id. at 304, 126 S.Ct. 2455. "In a Spending Clause case, the key is not what a majority of the Members of both Houses intend but what the States are dearly told regarding the conditions that go along with the acceptance of those funds." Id. (emphasis added). This legislative history, therefore, was not "sufficient to provide the requisite fair notice" that States bore this liability under the IDEA. Id.; but see id. at 309, 126 S.Ct. 2455 (Souter, J., dissenting) ("I can find no good reason for this Court to interpret the language of this statute as meaning the precise opposite of what Congress told us it intended.").
D. NCLB
1. Text of the Ad
We must view NCLB from the perspective of a state official who is engaged in the process of deciding whether the State should accept NCLB funds and the obligations that accompany those funds. See Arlington, 548 U.S. at 295, 126 S.Ct. 2455. In other words, we must determine whether NCLB furnishes clear notice to the official that her State, if it chooses to participate, will have to pay for any additional costs of implementing the Act that are not covered by the federal funding provided for under the Act. In examining NCLB, "we must not be guided by a single sentence or member of a sentence, but look to the provisions of the whole law, and to its object and policy," Pennhurst, 451 U.S. at 18, 101 S.Ct. 1531 (citations and internal quotations omitted), however, "if Congress intends to impose a condition on the grant of federal moneys, it must do so unambiguously." Barnes v. Gorman, 536 U.S. 181, 186, 122 S.Ct. 2097, 153 L.Ed.2d 230 (2002) (citations omitted). "Indeed, in those instances where Congress has intended the States to fund certain entitlements as a condition of receiving federal funds, it has proved capable of saying so explicitly." Pennhurst, 451 U.S. at 17-18, 101 S.Ct. 1531 (citation omitted). Here, no such provision exists. NCLB simply does not include any specific, unambiguous mandate requiring the expenditure of non-NCLB funds. Neither Judge McKeague, Judge Sutton nor the parties set forth any provision of NCLB that explicitly spells out the States' fiduciary obligations under this Act. To the contrary, § 7907(a) of NCLB provides that "[njothing in this Act shall be construed to . mandate a State or any subdivision thereof to spend any funds or incur any costs not paid for under this Act." Based on this provision, a state official likely would reach the opposite conclusion — namely, that her State would not be forced to provide funding for NCLB requirements for which federal funding falls short. Thus, we conclude a state official would not clearly understand that accepting federal NCLB funds meant agreeing to use state and local funds to meet goals rendered otherwise unreachable by deficient federal funding.
This is not to say that the Secretary's interpretation of the Act is frivolous. But the only relevant question is whether the Act provides dear notice to the States of their obligation. See Arlington, 548 U.S. at 296, 126 S.Ct. 2455. With this rule in mind, we turn to the various interpretations of the text offered by the parties and explain why we are not persuaded that the States' funding obligations are clear.
2. Plaintiffs'interpretation
Plaintiffs argue that the plain language of § 7907(a) excuses them from paying for the costs of compliance with NCLB that exceed those covered by federal funding. See Engine Mfrs. Ass'n v. S. Coast Air Quality Mgmt. Dist., 541 U.S. 246, 252, 124 S.Ct. 1756, 158 L.Ed.2d 529 (2004) ("Statutory construction must begin with the language employed by Congress and the assumption that the ordinary meaning of that language accurately expresses the legislative purpose." (internal quotation marks omitted)). For convenience, the language of § 7907(a) is as follows:
General prohibition. Nothing in this Act shall be construed to authorize an officer or employee of the Federal Government to mandate, direct, or control a State, local educational agency, or school's curriculum, program of instruction, or allocation of State or local resources, or mandate a State or any subdivision thereof to spend any funds or incur any costs not paid for under this Act.
20 U.S.C. § 7907(a) (emphasis added). The operative language under the Plaintiffs' reading of § 7907(a) is: "Nothing in this Act shall be construed to . mandate a State or any subdivision thereof to spend any funds or incur any costs not paid for under this Act." Read in this way, the clause exempts Plaintiffs from any costs that exceed federal funds.
Admittedly, there are problems with this interpretation. First, § 7907(a)'s placement within the statute weakens Plaintiffs' argument. Located in a section entitled, "Prohibitions on Federal Government and use of Federal funds," § 7907(a) is followed by three additional prohibitions: "Prohibition on endorsement of curriculum," "Prohibition on requiring Federal approval or certification of standards," and a prohibition on "mandat[ing] national school building standards." 20 U.S.C. § 7907(b), (c), and (d). These provisions expressly prohibit federal officials from imposing on States certain additional conditions to the requirements of NCLB. Because agencies generally have broad power to interpret and administer law, this section might be concerned with preventing federal commandeering of state officials as well as limiting agency authority in administering NCLB.
Interpreted in this way, the first clause of § 7907(a) prohibits federal officers or employees from commandeering the state educational system. 20 U.S.C. § 7907(a) ("Nothing in this Act shall be construed to authorize an officer or employee of the Federal Government to mandate, direct, or control a State, local educational agency, or school's curriculum, program of instruction, or allocation of State or local resources . "). Like the other subsections of § 7907, § 7907(a) arguably could be concerned with preventing the imposition of additional costs on states. Instead of prohibiting states from bearing any costs of compliance, the second clause may prohibit additional impositions on a State that are not agreed to by the State or set forth in NCLB. In other words, Congress may have intended to prohibit the expansion of any of the requirements under NCLB to micro-manage state officials in any way not expressly provided for under NCLB.
Second, while the Plaintiffs provide strong evidence that many States and indeed the former Secretary interpreted NCLB not to impose costs exceeding fed eral funding, their interpretation ignores the history of education funding, which suggests that Congress did not intend to fund all aspects of compliance with NCLB. The prior panel's dissent noted as much: "The notion that Congress intended to pay in full for a testing and reporting regime of indeterminate cost, designed and implemented by States and school districts, not federal agencies, is not only nonsensical and fiscally irresponsible, but also contravenes the traditional recognition of state and local governments' primary responsibility for public education." Pontiac Sch. Dist., 512 F.3d at 277 (McKeague, J., dissenting). Certainly, the history of education funding cuts against Plaintiffs' reading of § 7907(a) that Congress intended to exempt States from the costs of compliance with NCLB.
3. The Secretary's interpretations of the text
Two other interpretations of § 7907(a) have been advanced in this case, both of which — if Congress had clearly expressed them — would counter Plaintiffs' argument that § 7907(a) exempts the States from covering the costs of NCLB compliance in excess of federal funding. The first, which the district court adopted, is that this section merely prevents officers and employees of the federal government from imposing additional, unauthorized requirements on the participating States. The second is that this section simply emphasizes that state participation in NCLB is entirely voluntary, but that once a State chooses to participate, it must comply fully with NCLB requirements regardless of whether federal funding is adequate to cover the cost of compliance. As discussed below, neither of these interpretations is self-evident.
a. Stopping rogue federal officers or employees
The view that § 7907(a) simply restricts federal officials from imposing additional requirements — that is, those not authorized by the Act — on participating States arises from the first part of § 7907(a), which discusses "an officer or employee of the Federal Government." This reading interprets the Act to preclude any such officer or employee from mandating that a State incur costs not paid for under (that is, costs not authorized by) the Act:
General prohibition. Nothing in this Act shall be construed to authorize an officer or employee of the Federal Government to mandate, direct, or control a State, local educational agency, or school's curriculum, program of instruction, or allocation of State or local resources, or mandate a State or any subdivision thereof to spend any funds or incur any costs not paid for under this Act.
20 U.S.C. § 7907(a) (emphasis added).
In accepting this interpretation, the district court explained, the "[d]efendant argues convincingly that this sentence simply means no federal 'officer or employee' can require states or school districts to 'spend any funds or incur any costs not paid for under this Act.' " Pontiac, 2005 U.S. Dist. LEXIS 29253, at *11, 2005 WL 3149545, at *4. The court further explained that, "[b]y including the words 'an officer or employee of,' Congress clearly meant to prohibit federal officers and employees from imposing additional, unfunded requirements, beyond those provided for in the statute." Id. at *12, 2005 WL 3149545, at *4. In sum, the court concluded that § 7907(a) merely prevents rogue officers from imposing requirements not authorized by the Act. There are two problems with this interpretation.
First, it is not evident that the "officer or employee" language modifies the final clause of § 7907(a) discussing incurring costs under the Act. In other words, the "officer or employee" language reasonably can be read to modify only the middle clause regarding state and local control over curricula, as follows: "Nothing in this Act shall be construed to authorize an officer or employee of the Federal Government to mandate, direct, or control a State, local educational agency, or school's curriculum, program of instruction, or allocation of State or local resources.... " 20 U.S.C. § 7907(a). Under this reading, the final clause is modified by the opening clause: "Nothing in this Act shall be construed to . mandate a State or any subdivision thereof to spend any funds or incur any costs not paid for under this Act." Id. In this way, the Act prevents federal officers from controlling school curricula and allocations of local funds, but says nothing about officers mandating States to spend funds or incur costs for unauthorized obligations.
Second, if the "officer or employee" language is interpreted to modify the final clause, more fundamental problems emerge. For one, such a reading would require us to substitute words that are not in the statutory text ("Nothing in this Act shall be construed to authorize an officer or employee of the Federal Government to . mandate a State or any subdivision thereof to spend any funds or incur any costs not [authorized under this Act ]") for words that are in the text ("... or incur any costs not paid for under this Act "). Stating that a federal officer cannot require a State to incur any costs "not paid for" under the Act is, to say the least, is an unusual way of saying that an officer cannot require a State to incur costs for something that is not authorized under the Act. Were Congress truly concerned about this sort of ultra vires conduct by federal officers and employees, it could have said so expressly. Even if this were Congress's concern, we would be left with the following tautology: This Act does not authorize federal officers or employees to require States to incur costs for anything that the Act does not authorize.
b. Emphasizing that participating in the Act is voluntary
The Secretary also contends that the reference in the final clause of § 7907(a) to a State's costs under the Act simply emphasizes that a State's decision to accept federal funding under NCLB is entirely voluntary. The Secretary notes that this section provides limits on what the Act (or, if one accepts the reading discussed above, on what federal officers and employees) can "mandate" the States to do:
General prohibition. Nothing in this Act shall be construed to authorize an officer or employee of the Federal Government to mandate, direct, or control a State, local educational agency, or school's curriculum, program of instruction, or allocation of State or local resources, or mandate a State or any subdivision thereof to spend any funds or incur any costs not paid for under this Act.
20 U.S.C. § 7907(a) (emphasis added). The Secretary argues that Congress fully understood that a statute, such as NCLB, that imposes conditions on a receipt of federal funds is not a mandate. Rather, the section is intended to clarify that States would not be subject to requirements that formed no part of the condi tions set out in the statute. To support this reading, the Secretary notes that the Unfunded Mandates Act ("UMA"), 2 U.S.C. § 658(5)(A)(i)(II), defines "federal intergovernmental mandate" to exclude voluntary participation in federal programs. This reading is also flawed.
Plaintiffs do not contend that NCLB— as a whole — is an unfunded mandate forced upon the States. They appear willing to concede that NCLB is a voluntary program, and, therefore, their argument focuses on § 7907(a), not on the UMA. Plaintiffs argue that, now that they are participating in NCLB, the Secretary is imposing (that is, "mandating") liabilities that they did not bargain for — and that are expressly prohibited by § 7907(a) — when they signed onto NCLB. There are at least three additional reasons why § 7907(a) should not be read to merely emphasize the voluntariness of the program.
First, it is not apparent that § 7907(a) addresses States' voluntary participation in NCLB as opposed to their obligations after they have agreed to participate. The Secretary's reading would be easier if the Act stated that nothing in it shall be construed to mandate a State to "comply with the Act" or that nothing in the Act shall be construed to mandate a State to "incur any costs under this Act" — language like that would indicate that States can choose not to comply with the Act altogether. Instead, the text provides that nothing in the Act shall be construed to mandate a State to "incur any costs not paid for under this Act " — language that a State could plausibly interpret to relate to its obligations after it has agreed to comply with the Act. Indeed, based on the text of § 7907(a), Vermont has passed a law providing that neither the State nor its subdivisions will be required to "incur any costs not paid for under the Act in order to comply with the provisions of the Act." Vt. Stat. Ann. tit. 16 § 165 (2003). In short, it is not apparent that § 7907(a) relates merely to the States' freedom to choose whether to opt into the Act in the first place.
Second, the use of the exact language of § 7907(a) in the Perkins Vocational Education Act ("Perkins Act"), 20 U.S.C. § 2301-2471 (1988), indicates that this language concerns a State's funding obligations under NCLB, rather than voluntary compliance with the Act. Under the Perkins Act, federal grants are issued to " 'assist the States to expand, improve, modernize, and develop quality vocational education programs in order to meet the needs of the Nation's existing and future work force for marketable skills and to improve productivity and promote economic growth.' " Pennsylvania v. Riley, 84 F.3d 125, 127 (3d Cir.1996) (quoting 20 U.S.C. § 2301(1)). Section 2306a of the Perkins Act, entitled "Prohibitions," mirrors NCLB's § 7907(a), but adds a final clause:
(a) Local control. Nothing in this Act shall be construed to authorize an officer or employee of the Federal Government to mandate, direct, or control a State, local educational agency, or school's curriculum, program of instruction, or allo cation of State or local resources, or mandate a State or any subdivision thereof to spend any funds or incur any costs not paid for under this Act, except as required under sections 112(b), 311(b), and 323.
20 U.S.C. § 2306a(a) (emphasis added). The sections referred to in this final clause require agencies in participating States to spend non-federal funds for specific purposes. See, e.g., 20 U.S.C. § 2413(a) (Perkins Act § 323) ("Except as provided in subsection (b), for each fiscal year for which an eligible agency receives assistance under this Act, the eligible agency shall provide, from non-Federal sources for the costs the eligible agency incurs for the administration of programs under this Act, an amount that is not less than the amount provided by the eligible agency from non-Federal sources for such costs for the preceding fiscal year."). Thus, the final clause — absent in NCLB — provides explicit exceptions describing when participating States do have to expend their own funds when complying with the Perkins Act's requirements. The common language in these Acts, therefore, does not simply reiterate that States may or may not participate in the federal program. While there are differences between the Perkins Act and NCLB, the differences in the overall structure of the statutes do not negate the informative role that the identical sixty-two-word provision found in both of the statutes can provide. In the Perkins Act, the sixty-two-word provision is followed by exceptions to the provision. In NCLB, the sixty-two-word provision is followed by no exceptions. The difference between the Perkins Act and NCLB in this regard shows that Congress is capable of explicitly stating when States must provide funding under these Acts. Cf. Pennhurst, 451 U.S. at 17-18, 101 S.Ct. 1531 ("[I]n those instances where Congress has intended the States to fund certain entitlements as a condition of receiving federal funds, it has proved capable of saying so explicitly.").
Third, the Secretary's comparison with the provisions of the UMA sheds little light here, as (1) NCLB makes no reference to the UMA's definition of "mandate," which excludes voluntary participation in federal programs, and (2) "the label 'mandate' is often applied to obligations that states assume voluntarily in order to qualify for federal funds." Patricia T. Northrop, Note, The Constitutional Insignificance of Funding for Federal Mandates, 46 Duke L.J. 903, 903 n.2 (1997). Indeed, another section of the UMA itself defines "mandate" to include a duty arising from voluntary participation in federal programs. 2 U.S.C. § 1555 (defining the phrase for purposes of a commission that would review federal mandates).
E. Whether NCLB satisfies the dear-notice requirement of the Spending Clause
Whether or not Congress intended to fund all the costs of compliance with NCLB, if Congress did not provide clear notice to the States, any requirement that States fund the excess costs of compliance is unenforceable. The Spending Clause permits Congress to condition its grant of federal money to States only if it does so unambiguously. The appropriate inquiry is not whether Congress intended States to fund some of the costs of compliance, but whether it provided the States with clear notice of this intention. See Arlington, 548 U.S. at 296, 126 S.Ct. 2455.
Viewing the Spending Clause relationship between a State and the federal government as a contract, the Supreme Court has stated that "[t]he legitimacy of Congress' power to legislate under the spending power thus rests on whether the State voluntarily and knowingly accepts the terms of th[at] 'contract.' " Pennhurst, 451 U.S. at 17, 101 S.Ct. 1531. The Secretary cites Bennett v. Ky. Dep't of Educ., 470 U.S. 656, 669, 105 S.Ct. 1544, 84 L.Ed.2d 590 (1985), for the proposition that "[u]nlike normal contractual undertakings, federal grant programs originate in and remain governed by statutory provisions expressing the judgment of Congress concerning desirable public policy." The Secretary argues that, in contrast to general contract law, ambiguities in a grant program must not necessarily "be resolved against the party who drafted the agreement, ie., the Federal Government." Id. at 666, 105 S.Ct. 1544.
However, even when the textual ambiguities are resolved in favor of the federal Government, NCLB still fails the Spending Clause inquiry because it does not provide clear notice to States that they must incur the costs of compliance. In § 6332(b)(1), Congress acknowledged the possibility that it might not be able to provide all of the funds for which States are eligible under NCLB, and Congress provided for a pro rata distribution if such a shortfall were to occur. But Congress never clearly explained who would be responsible for the remaining costs if and when it could not cover them. Thus, not only did Congress never specifically articulate that States would be responsible for covering any additional costs of compliance, but Congress's inclusion of § 7907(a) further confuses the issue of potential state liability.
When asking "whether such a state official would clearly understand . the obligations," Arlington, 548 U.S. at 296, 126 S.Ct. 2455, the answer must, therefore, be "No." We need not decide which of the three above described interpretations of § 7907(a) is correct as that is not our relevant inquiry. They are all plausible, and they are all flawed. While the Secretary may be correct that Congress did not intend to provide full funding for NCLB, many reasonable authorities have interpreted NCLB to mean precisely the opposite. "When [Connecticut, Delaware, Illinois, Maine, New Mexico, Oklahoma, Wisconsin, and the District of Columbia] acted to accept NCLB Act funding and to adopt NCLB Act requirements, it was with the understanding that the Secretary of Education would comply with all of the provisions of the NCLB Act, including the Unfunded Mandates Provision." (Amicus Br. of the States of Conn., Del., Ill., Me., N.M., Okla., Wis., D.C. at 4.) Further, the district court, this Court's prior panel majority, and the panel dissent all have interpreted § 7907(a) differently. Even the former Secretary of Education found that § 7907(a) means the opposite of what the current Secretary claims. Consequently, the only thing clear about § 7907(a) is that it is unclear.
III. CONCLUSION
NCLB rests on the most laudable of goals: to "ensure that all children have a fair, equal, and significant opportunity to obtain a high-quality education." 20 U.S.C. § 6301. Here, nobody challenges that aim. But a state official deciding to participate in NCLB reasonably could read § 7907(a) to mean that the State need not comply with requirements that are "not paid for under the Act" with federal funds.
Congress has not "spoke[n] so clearly that we can fairly say that the State[s] could make an informed choice" to participate in the Act with the knowledge that they would have to spend non-NCLB funds to comply with the Act's requirements. Pennhurst, 451 U.S. at 25, 101 S.Ct. 1531. If Congress intended otherwise, the ball is properly left in its court to make that clear. See Arlington, 548 U.S. at 306, 126 S.Ct. 2455 (Ginsburg, J., concurring).
Finally, I would not have this opinion read so broadly as to eviscerate the other mandates of NCLB. The record is clear that the States accepted NCLB funding under conditions spelled out in the Act. There should be no doubt that States and school districts must comply with the mandates to the extent of NCLB funds received and must support their own prior levels of funding as NCLB requires. Plaintiffs' ongoing responsibilities under NCLB are thus among the issues that I would have the parties and the district court consider on remand. Accordingly, I would reverse the district court's judgment dismissing Plaintiffs' complaint and remand for further proceedings consistent with this opinion.
. Plaintiffs consist of nine school districts from three different States (Michigan, Texas, and Vermont) and ten education associations from ten different States (Connecticut, Illinois, Indiana, Michigan, New Hampshire, Ohio, Pennsylvania, Texas, Utah, and Vermont). The school districts are Pontiac School District, Laredo Independent School District, Leicester Town School District, Neshobe Elementary School District, Otter Valley Union High School, Pittsford Town School District, Rutland Northeast Supervisory Union (which itself contains eleven school districts), Sudbury Town School District, and Whiling Town School District (collectively, the "school district Plaintiffs"). The education associations are the National Education Association ("NEA") and ten NEA-affiliate education associations: the Connecticut Education Association, the Illinois Education Association, the Michigan Education Association, the Ohio Education Association, the Reading Education Association, the Utah Education Association, the Indiana State Teachers Association, the Texas State Teachers Association, NEA-New Hampshire, and the Vermont NEA (collectively, the "education association Plaintiffs").
. Plaintiffs do not argue that the funds distributed by NCLB are a substitute for those funds that have historically come from state and local sources. Instead, Plaintiffs argue only that they should not be required to incur additional funding obligations to comply with NCLB when those obligations would not be incurred absent the State's attempt at NCLB compliance.
. Plaintiffs allege that "it would be futile for the plaintiff school districts to ask" for a waiver because of the Secretary's uniform rejection of requests for waivers. (JA 22-23.) The Secretary does not dispute that a request would be futile. Moreover, even if the Secretary granted waivers for the Plaintiffs here, it would not change this Court's Spending Clause analysis, nor would it protect other school districts that may not be granted waivers in the future.
. In fact, several States did participate in this lawsuit as amici curiae. See Amici Curiae Br. of the States of Connecticut, Delaware, Illinois, Maine, Oklahoma, Wisconsin, and the District of Columbia (filed Apr. 3, 2006); Ami-cus Curiae Br. of the Governor of the Commonwealth of Pennsylvania (filed Apr. 6, 2006).
. In this case, Plaintiffs do not dispute that Congress did clearly intend to place conditions on the grant of federal funds. However, there is no mention of the cost of compliance anywhere in the text of NCLB. Plaintiffs argue that Congress's silence cannot be interpreted as a clear statement that States and local governments would be required to spend their own funds to cover any shortfall of federal funds.
. Former Secretary of Education Rod Paige described the Act as "contain[ing] language that says things that are not funded are not required." (Compl. 11; JA 20.) He later emphasized that "if it is not funded, it's not required. There is language in the bill that prohibits requiring anything that is not paid for." (Compl. 12; JA 21.)
. The amici question, however, whether a State can, as a practical financial matter, refuse federal funding under NCLB. See, e.g., Amicus Curiae Br. of the Governor of the Commonwealth of Pennsylvania at 20 (noting that "states have come to depend upon [federal] funds to provide extra assistance to students who are economically and academically disadvantaged" and that "states are coerced to accept additional and financially burdensome requirements, so that they may continue to provide services and programs that they have offered to their neediest students for years"); see also New York v. United States, 505 U.S. 144, 175, 112 S.Ct. 2408, 120 L.Ed.2d 120 (1992) (noting in another context that "Congress has crossed the line distinguishing encouragement from coercion").