b"Management of Admiralty Island and Misty Fiords National\nMonuments\nE x e c u tiv e O rd e r N o. 6166 leaves in ta c t forest reserv atio n s o n national m o n u m en t lands,\nan d th e D e p a rtm e n t o f A g ric u ltu re an d th e D e p a rtm e n t o f th e In te rio r th u s share\nad m in istrativ e responsibility fo r A d m ira lty Island and M isty F io rd s N ational M o n u \xc2\xad\nm ents. C o n clu sio n o f op in io n o f F e b ru a ry 9, 1979 (3 O p. O .L .C . 85 (1979)), that\nm an ag em en t fu n ctions in c o n n e c tio n w ith th e tw o national m o n u m en ts m ust be tra n s\xc2\xad\nferred from th e D e p a rtm e n t o f A g ric u ltu re to the D e p a rtm e n t o f the In terio r, rec o n sid \xc2\xad\nere d and am en d ed.\n\nFebruary 8, 1980\nM EM O R A N D U M O P IN IO N FO R T H E D IR E C T O R , O F F IC E O F\nM ANA GEM ENT AND BUDGET\nThis is to advise you that, at the request o f the G eneral Counsel to\nthe U.S. D epartm ent o f A griculture (U SD A ), we have reconsidered\nand are amending, as follows, our February 9, 1979, memorandum to\nyou concerning the \xe2\x80\x9c M anagement o f Adm iralty Island and Misty\nFiords National M onum ents.\xe2\x80\x9d [3 Op. O.L.C. 85 (1979)]. We concluded\nin that opinion that \xc2\xa72 o f Executive O rder No. 6166, 5 U.S.C. \xc2\xa7901\nnote (1976), required a transfer o f managem ent functions from the\nForest Service in U SD A to the National Park Service in the D epart\xc2\xad\nment o f the Interior w ith respect to tw o national m onuments created in\nD ecem ber 1978, on national forest lands. As explained below, we have\nsubsequently concluded that both U SD A and Interior have legal au\xc2\xad\nthority to manage the lands in question.\n\nI. Background to the February 9, 1979, Opinion\nT he President, on D ecem ber 1, 1978, exercised his pow ers under \xc2\xa72\no f the Antiquities A ct o f 1906, 16 U.S.C. \xc2\xa7431 (1976), to create national\nmonum ents at Adm iralty Island and Misty Fiords, Alaska. Pres. Proc.\nNos. 4611 & 4623, 43 Fed. Reg. 57,009, 57,087 (1978). Included within\nthese monuments w ere approxim ately 3.4 million acres o f federal land\nthat had been reserved as part o f Tongass National Forest in 1907 or\n1909. 35 Stat. (Pt. 2) 2152, 2226. On Novem ber 30, 1978, your General\nC ounsel\xe2\x80\x99s office inquired orally o f this Office w hether the placem ent of\na m onum ent reservation on these national forest lands required the\ntransfer o f the management o f the lands to the D epartm ent o f the\n\n396\n\n\x0cInterior under Executive O rder No. 6166, issued in 1933. Section 2 of\nthat order provides:\nAll functions o f administration\no f . . . national\nmonuments . . . are consolidated in the National Park\nService in the D epartm ent of the Interior . . .; except\nthat w here deemed desirable there may be excluded from\nthis provision any public building or reservation w hich is\nchiefly employed as a facility in the work of a particular\nagency.\nIn response to your inquiry, on D ecem ber 1, 1978, we solicited views\non this question from Interior and USDA. Interior chose to express no\nview. U SD A forw arded its opinion to us that \xc2\xa72 o f Executive O rder\nNo. 6166 would have expunged the forest status o f Misty Fiords and\nAdm iralty Island\xe2\x80\x94thus requiring a transfer o f m anagement functions\nfrom U SD A to Interior\xe2\x80\x94but for \xc2\xa79 o f the National Forest M anage\xc2\xad\nment A ct o f 1976, 16 U.S.C. \xc2\xa7 1609 (1976), which, in its view, pro tanto\nrepealed the executive order and required the management of national\nforest land to remain in the Forest Service until rem oved by A ct of\nCongress. In essence, our February 9, 1979, opinion treated U S D A \xe2\x80\x99s\nanalysis as the sole issue in dispute, and concluded, contrary to its view,\nthat \xc2\xa79 o f the National Forest M anagement A ct had no effect on the\noperation of the executive order. We consequently informed you that,\nabsent some legislative action, the m anagement o f these m onuments had\nto be tranferred from the U SD A to Interior.\n\nII. Reconsideration\nOn Septem ber 12, 1979, U S D A \xe2\x80\x99s G eneral Counsel forw arded certain\nmaterials to us suggesting the appropriateness o f reconsidering our\nFebruary 9, 1979, opinion. A lthough, in prior conversations, the G en\xc2\xad\neral Counsel had indicated that he did not wish to challenge our\nconclusions on the relationship o f the Forest M anagem ent A ct to Exec\xc2\xad\nutive O rder No. 6166, he questioned the premise, implicit in our opin\xc2\xad\nion and in his ow n D epartm ent\xe2\x80\x99s earlier view, that Executive O rder\nNo. 6166 operated to expunge the national forest status o f A dm iralty\nIsland and Misty Fiords. In his view, such status, at least w ith respect\nto monuments created on forest lands after 1933, could be expunged\nsolely by the express exercise o f authority under 16 U.S.C. \xc2\xa7473, which\npermits the President to revoke o r modify prior presidential actions\ncreating national forests, such as Tongass National Forest, out o f unre\xc2\xad\nserved public lands. He urged that the effect o f the executive order was\nonly to vest additional management responsibilities in the D epartm ent\no f the Interior for national m onuments created on forest lands, thus\npermitting the tw o departm ents to share adm inistrative responsibility\nfor Adm iralty Island and Misty Fiords.\n\n397\n\n\x0cWe have concluded that U S D A \xe2\x80\x99s G eneral Counsel has correctly\ninterpreted the 1933 order. T he purpose of Executive O rder No. 6166\nwas to effect economies in governm ent by facilitating the consolidation\no f similar functions under single governm ent authorities. W ith respect\nto national monuments, it consolidated m anagement functions in the\nNational Park Service o f the D epartm ent o f the Interior. Its subject\nm atter, how ever, does not include the status o f reservations attaching\nto national m onum ent lands. It does not expressly expunge\nnonm onum ent reservations on national monum ent lands, and no\nexpungement appears by implication. T he executive order is fully effec\xc2\xad\ntive so long as it is interpreted to make possible National Park Service\nm anagem ent o f forest lands that are national monuments, which itself\ndoes not require the elimination o f forest status.\nT he conclusion that Executive O rder No. 6166 leaves forest reserva\xc2\xad\ntions on national m onum ent lands intact is buttressed by the existence,\nsince 1897, o f express statutory authority perm itting the President to\nexpunge the forest status o f forest lands rem oved previously by the\nPresident from unreserved public lands. 16 U.S.C. \xc2\xa7473 (1976). N oth\xc2\xad\ning . in the executive order suggests that it is to be viewed as an\nalternative or even an additional means o f term inating the forest status\no f national forests. Indeed, the o rd e r\xe2\x80\x99s limited organizational function is\ninconsistent w ith the notion that it confers additional substantive au\xc2\xad\nthorities w ith respect to public lands. In cases o f national monuments\ncreated on national forest lands since 1933, the President has consist\xc2\xad\nently exercised his authority under 16 U.S.C. \xc2\xa7 473 to revoke or modify\nthe forest status o f lands he wished to be treated as having only\nnational m onum ent status. See, e.g., Pres. Procs. Nos. 2330, and 2339, 53\nStat. (Pt. 3) 2534, 2544 (1939). This practice implies a continuing adm in\xc2\xad\nistrative interpretation that Executive O rder No. 6166 does not itself\nautom atically term inate the national forest status o f m onum ents created\non national forest lands.\nOn N ovem ber 17, 1972, U S D A and Interior entered into an agree\xc2\xad\nment, concluding that Executive O rder No. 6166, as amended, ex\xc2\xad\npunged the dual status o f m onum ents created on forest lands prior to\n1933. In essence, the departm ents agreed to follow a 1933 opinion of\nthe Solicitor o f the D epartm ent o f the Interior, holding that, in the\nabsence o f a timely interdepartm ental agreem ent to the contrary, the\nmanagem ent o f pre-1933 m onum ents on forest lands was transferred\nautom atically to Interior by Executive O rder No. 6166. W e have not\nbeen asked to consider this opinion o r the 1972 agreem ent, and express\nno view as to their conclusions. W e note, how ever, that such a determ i\xc2\xad\nnation as to pre-1933 monuments, w hich did not construe the effect of\nthe executive o rder on the status o f reservations attaching to national\nm onum ent lands, does not preclude a case-by-case adm inistrative deci\xc2\xad\nsion as to the proper m anagem ent o f post-1933 national monum ents to\n\n398\n\n\x0cthe extent perm itted by the executive order and any other applicable\nstatutory authorities. Executive O rder No. 6166 creates management\nauthority in the National Park Service with respect to national m onu\xc2\xad\nments even if created on forest lands; w hether that authority is exclu\xc2\xad\nsive, additional, delegable, or forfeitable depends on the terms o f the\norder and other authorities that may exist with respect to the lands.\n\nIII. Management Options\nBecause the President, in creating Adm iralty Island and Misty Fiords\nNational M onuments, did not term inate the national forest status of\nthose lands, the National Park Service, under Executive O rder No.\n6166, and the Forest Service, under its statutory authorities, 16 U.S.C.\n\xc2\xa7551 et seq., are both authorized to participate in the m anagement o f\nthese monuments. Both, we have been advised, have appropriations that\nmay be applied to this purpose.\nOn January 15, 1980, representatives o f this D epartm ent met with\nrepresentatives o f U SD A and Interior, to discuss the future m anage\xc2\xad\nment o f A dm iralty Island and Misty Fiords. T he U SD A and Interior\nrepresentatives agreed that the Forest Service and the National Park\nService would enter into a memorandum of understanding to govern\nthe management o f these monuments, accounting for the land use stand\xc2\xad\nards binding on the departm ents and specifying each departm ent\xe2\x80\x99s regu\xc2\xad\nlatory and budgetary responsibilities. We have concluded that this is a\npermissible option for structuring the m anagement responsibilities o f the\ntw o departments. Cf. 16 U.S.C. \xc2\xa7 2 (1976), perm itting the Secretary of\nA griculture to cooperate with the National Park Service, to the extent\nrequested by the Secretary o f the Interior, in the supervision, m anage\xc2\xad\nment, and control o f national m onuments contiguous to national forests.\nL arry A. H am m ond'\n\nD eputy Assistant Attorney General\nOffice o f Legal Counsel\n\n399\n\n\x0c"


b'Amendment of the Farmers Home Administration\nDisaster Loan Program\nU n d er applicable provisions o f th e A dm inistrative P ro ced u re Act, am endm ents to regula\xc2\xad\ntions gov ern in g the disaster lo a n program adm inistered b y the Farm ers H om e A dm inis\xc2\xad\ntratio n (F m H A ) can be m ade effective im m ediately, w ithout giving the public a prior\no p p o rtu n ity to com m ent, if th e F m H A finds for \xe2\x80\x9cg o o d cause\xe2\x80\x9d th at notice and public\np ro c ed u re thereon would be \xe2\x80\x9c im practicable, unnecessary, or con trary to the public\nin terest.\xe2\x80\x9d\nIt is fo r th e rulem aking agency to determ ine w h e th er th ere is \xe2\x80\x9cgood cause\xe2\x80\x9d for dispensing\nw ith notice and comm ent; h o w e v er, if the facts are such that the authorized adm inistra\xc2\xad\ntiv e purpose w ould be frustrated by delay, th e argum ent for proceeding expeditiously is\nreasonable on its face.\n\nApril 24, 1981\n- M EM ORANDUM O P IN IO N FO R T H E CO UN SEL TO T H E\nD IR E C T O R , O FFIC E O F M A N A G EM EN T A N D BU D G ET\nYou have requested the views of this Office on a procedural question\nthat involves regulations that govern the disaster loan program adminis\xc2\xad\ntered by the Farmers Hom e Administration (FmHA). The question is\nw hether the Fm H A can amend these regulations and make the amend\xc2\xad\nment effective immediately, without giving the public an opportunity to\ncomm ent on the amendment beforehand.\nT he relevant facts, as we understand them, are as follows: The\ndisaster loan program is governed by Title III of the Consolidated\nFarm and Rural Development Act, as amended (the Act), 7 U.S.C.\n\xc2\xa7\xc2\xa7 1961-1996. The Act authorizes the Secretary of Agriculture to make\nand insure loans for persons whose agricultural operations have been\n\xe2\x80\x9csubstantially affected\xe2\x80\x9d by natural disaster. 7 U.S.C. \xc2\xa7 1961(b). It also\ngives the Secretary broad authority to make regulations that prescribe\nthe terms and conditions under which those loans will be made and\ninsured. See 7 U.S.C. \xc2\xa7 1989. Relying upon that general authority, the\nFm H A has promulgated elaborate regulations that establish eligibility\nstandards, loan criteria, and loan application procedures. See 45 Fed.\nReg. 9848 (1980). The Fm H A is now considering various amendments\nto these regulations, and the question has arisen whether these amend\xc2\xad\nments can be made effective for loan applications arising from disasters\nthat occurred in the 1980 crop year. With the advent of the new\nplanting season, the 1980 applications are being filed and granted at a\n104\n\n\x0crapid rate, and the process will be complete in a few weeks. The\namendments now under consideration cannot substantially affect that\nprocess unless they are made effective immediately.\nThe Act itself does not require the agency to follow any particular\nprocedure in making or amending the regulations that govern the loan\nprogram. The relevant provisions of this Administrative Procedure Act\n(APA), which establish a generic \xe2\x80\x9cnotice and comment\xe2\x80\x9d procedure for\ninformal agency rulemaking, do not apply of their own force to matters\nrelating to agency \xe2\x80\x9cloans.\xe2\x80\x9d 5 U.S.C. \xc2\xa7 553(a)(2). The Secretary of\nAgriculture, however, has adopted the APA procedure and has made it\napplicable to all USDA loans. In a memorandum published in July,\n1971, the Secretary announced the following policy:\nThe public participation requirements prescribed by 5\nU.S.C. \xc2\xa7 553(b) and (c) will be followed by all agencies of\nthe Departm ent in rule making relating to . . . loans . . . .\nThe exemptions permitted from such requirements where\nan agency finds for good cause that compliance would be\nimpracticable, unnecessary, or contrary to the public in\xc2\xad\nterest will be used sparingly, that is, only when there is a\nsubstantial basis therefor. Where such a finding is made,\nthe finding and a statement of the reasons therefore [sic]\nwill be published with the rule.\n36 Fed. Reg. 13,804 (1971).1\nTo our knowledge, this memorandum has never been modified or\nwithdrawn. It has been treated by the courts as an agency rule, binding\non the Fm HA while in force. See Berends v. Butz, 357 F. Supp. 143 (D.\nMinn. 1973).\nThe 1971 memorandum makes reference to the statutory exemption\nthat permits new agency rules to be effective without prior comment\nby the public. Under the APA, this exemption may be invoked if the\nagency finds, for \xe2\x80\x9cgood cause,\xe2\x80\x9d that notice o f a proposed rule and\npublic procedure thereon would be \xe2\x80\x9cimpracticable, unnecessary, or\ncontrary to the public interest.\xe2\x80\x9d 5 U.S.C. \xc2\xa7\xc2\xa7 553(b)(B), 553(d)(1). In\naccordance with the terms of the 1971 memorandum, the Fm HA may\ninvoke the statutory exemption if it makes the required \xe2\x80\x9cgood cause\xe2\x80\x9d\nfinding and the finding is supported by a \xe2\x80\x9csubstantial basis.\xe2\x80\x9d\nIt is for the agency to determine whether the circumstances of the\npresent case are such that the exemption to the notice and comment\nprocedure should be invoked. The judgment whether notice and com\xc2\xad\nment is \xe2\x80\x9cimpracticable, unnecessary, or contrary to the public interest\xe2\x80\x9d\nis judicially reviewable, see, e.g., Nader v. Sawhill, 514 F.2d 1064\n(Temp. Emer. Ct. App. 1975); but at bottom it is a policy judgment,\n1We note that the 1971 memorandum adopts the \xe2\x80\x9c public participation\xe2\x80\x9d requirements o f \xc2\xa7 553(b) and\n\xc2\xa7 553(c) but does not by its terms adopt the 30-day publication requirement of \xc2\xa7 553(d)\n\n105\n\n\x0cgrounded in facts and in the agency\xe2\x80\x99s view o f what the interests of the\npublic require. W e note simply that if the amendments under consider\xc2\xad\nation here are authorized by the Act, and if the facts are such that the\nauthorized administrative purpose would be frustrated if the effective\ndate o f the amendments were delayed, the argument for proceeding\nexpeditiously, on grounds o f practicality and public interest, is reason\xc2\xad\nable on its face.2\nT\n\nheodore\n\nB.\n\nO\n\nlson\n\nAssistant Attorney General\nOffice o f Legal Counsel\n\n2 W e would also observe that the Secretary of Agriculture is free at any time to revoke or render\ninapplicable to any particular rulemaking the policy established in 1971. Such revocation, in toto or as\napplied to a specific rulemaking, w ould, we believe, be dispositive of the question raised by the\nexistence o f that policy. Such revocation should be done tn a public document at any point prior to\nissuance o f a final rule. See Nader v. Bork, 366 F. Supp. 104 (D .D .C. 1973).\n\n106\n\n\x0c'


b'Senatorial Courtesy\nThe custom known as \xe2\x80\x9csenatorial courtesy,\xe2\x80\x9d whereby certain nominations to federal office have been\nobjected to by an individual senator on the ground that the person nominated is not acceptable to\nhim, appears recently to have been limited to local offices of the federal government.\n\nMay 29, 1942\n\nMEMORANDUM OPINION FOR A UNITED STATES SENATOR*\nThe custom known as \xe2\x80\x9csenatorial courtesy\xe2\x80\x9d is not a formal rule of the Senate,\nand is not included in the published rules of that body. The term is used to refer to\na practice of long standing whereby certain nominations to federal office have\nbeen objected to by an individual senator on the ground that the person nominated\nis not acceptable to him. The question of whether this practice is in any sense\njustifiable or desirable is one which the Senate itself must decide. In this memorandum I am merely calling attention to relevant authorities and precedents,\nwithout attempting to state my own personal views on the desirability of the\npractice or, of course, attempting to advise the Senate.\nIf it be conceded that the practice may in certain instances be justifiable and\neven desirable, in sound reason it would seem that the exercise of the practice\nshould be limited to cases in which a senator makes objection to an individual who\nis a resident of the senator\xe2\x80\x99s own state, and has been nominated for local federal\noffice in that state. The argument is advanced, perhaps not without some merit,\nthat the senator is in a position to report to his colleagues the views of his constituents as to the qualifications of the individual in question\xe2\x80\x94an individual whose\nduties will bring him in intimate contact with the daily lives of those constituents.\nThis argument would not seem to be applicable to positions of national importance, the duties of which are not limited to any one state. As to such a\nposition, an individual senator would seem to be acting in his capacity as a\nmember of the council of elder statesmen of the nation, rather than as a representative primarily of his own constituents.\nExpressions by distinguished members of the Senate in recent years have tended to be in accord with the view that senatorial courtesy should apply only to local\noffices, the duties of which are limited to the state of the objecting senator. For\nexample, on March 23, 1932, Senator Watson said:\nMr. WATSON. . . . [W]hen I came here I adopted the policy of\nvoting against the confirmation of any man appointed to a Federal\n*\nEditor\xe2\x80\x99s Note: This memorandum was conveyed under cover of a letter from Assistant Solicitor\nGeneral Cox to Senator George L. Radcliffe of Maryland, stating as follows: \xe2\x80\x9cThe Attorney General\nhas asked me to prepare and send to you a memorandum on the custom known as \xe2\x80\x98Senatorial\nCourtesy.\xe2\x80\x99 I am herewith transmitting a copy of such a memorandum.\xe2\x80\x9d\n\n88\n\n\x0cSenatorial Courtesy\n\nposition if and when a Senator from the State in which he lived rose\nin his place on the floor of the Senate and stated that the appointment\nwas personally obnoxious and personally offensive to him. Originally that rule was followed without regard to the field of activity of the\nappointee; that is to say, if a man were appointed to office anywhere\nand a Senator rose to say the appointment was personally offensive,\nit was regarded as sufficient to cause rejection. But about 10 years\nago there was a modification of the rule here, and I was one of those\nwho led the fight to bring about the modification.\n....\nMr. NORRIS. The Senator does not mean to say there is a rule on\nthat subject in the Senate?\nMr. WATSON. No; I do not mean to say there is a rule; but there\nis a practice; if the Senator please, an unwritten rule. . . .\nIt is a practice or custom that has been followed; so that where a\nman is appointed to serve wholly within the State represented by the\nSenator who makes the objection, in such a case his objection on\nsuch grounds is sufficient reason for rejection.\n75 Cong. Rec. 6729.\nOn March 23, 1934, the following colloquy between Senator Overton and\nSenator Barkley occurred:\nMr. OVERTON. . . . Mr. President, let me make the additional\nstatement that I understood that whenever a Senator from a State\nmade an objection to the appointment of someone who was to discharge the duties of an office that was wholly intrastate, and based\nthat objection upon the ground that the person named was personally\nobnoxious to him, the Senate respected that objection. . . .\nMr. BARKLEY. . . . I realize that from time immemorial, where a\nSenator objects to a nomination or appointment of a citizen of his\nState to a local office, and states that the appointment is personally\nobjectionable and obnoxious to him, the Senate heretofore, almost as\na universal rule\xe2\x80\x94which does not have the force of law, but is the\nresult of courtesy\xe2\x80\x94has respected that objection, and has refused to\nconfirm the nominee. In recent years, I think it ought to be said,\nthere has been some modification of that unwritten rule to the extent\nof asking or expecting the Senator who makes the objection on per-\n\n89\n\n\x0cSupplemental Opinions of the Office of Legal Counsel in Volume 1\n\nsonal grounds to present some reason for the objection. Otherwise its\narbitrary exercise would make it impossible for an Executive to appoint anybody in the State who could be confirmed.\n78 Cong. Rec. 5251.\nSimilarly, on June 29, 1939, Senator Wheeler said:\nIn the 16 years I have been a Member of the Senate I have not\nknown the Postmaster General of the United States to name appointees in a particular State over the objection of either one of the Senators. Perhaps it has been done; but, if so, it has never been called to\nmy attention during my service in the Senate. . . .\nIt has always been recognized that a different rule applies to\nappointments outside the State from that applying to appointments\nwithin the State.\n84 Cong. Rec. 8225, 8226.\nLeading text writers, apparently without exception, have indicated that senatorial courtesy should be confined to local offices. To quote:\n\xe2\x80\x9c[T]hrough the development of what is known as the \xe2\x80\x98courtesy of the\nSenate,\xe2\x80\x99 the Senators from each state when they belong to the same\npolitical party as the President generally control the nominations to\nlocal offices of the national government within their own state.\xe2\x80\x9d John\nA. Fairlie, The National Administration of the United States of America 45\xe2\x80\x9346 (1905).\n\xe2\x80\x9cThe Constitution provides that appointments to federal office shall\nbe made by the President with the advice and consent of the Senate.\nBut in consequence of the custom known as \xe2\x80\x98senatorial courtesy,\xe2\x80\x99\nwhen the President makes an appointment to a local federal office he\nis virtually obliged to obtain the consent of the senators from the particular state in which the office is located, if they belong to his party.\nOtherwise the Senate will not approve the appointment.\xe2\x80\x9d James Wilford Garner & Louise Irving Capen, Our Government: Its Nature,\nStructure, and Functions 263 (1938).\n\xe2\x80\x9cIn late years, however, there has come into existence the custom\nknown as \xe2\x80\x98senatorial courtesy,\xe2\x80\x99 according to which the President\nmust obtain in advance the approval of the senators from the particular state in which an office to be filled is located, provided they\nbelong to his political party. If he refuses to do so and nominates a\n\n90\n\n\x0cSenatorial Courtesy\n\nperson who is objectionable to the senators from that state, the other\nsenators as a matter of \xe2\x80\x98courtesy\xe2\x80\x99 to their offended colleagues will\ncome to their rescue and refuse to approve the appointment. It has\ncome to pass, therefore, that individual senators in many cases are\nvirtually the choosers of federal officers in their states.\xe2\x80\x9d Id. at 333.\n\xe2\x80\x9cA class of important federal offices scattered among the states,\nthough nominally filled by the President with the advice and consent\nof the Senate, is subject largely to the control of the latter, as a result\nof a time-honored practice known as \xe2\x80\x98senatorial courtesy.\xe2\x80\x99 Under its\npower to advise and consent, the Senate does not officially suggest\nnames to the President, but it will ratify nominations to many offices\nonly under certain conditions. If either one or both of the Senators\nfrom the state in which the offices under consideration are located\nbelong to the President\xe2\x80\x99s political party, then executive freedom of\nchoice almost disappears.\xe2\x80\x9d Charles A. Beard, American Government\nand Politics 151 (8th ed. 1939).\nHaynes, in his Senate of the United States, has perhaps the most complete\ndiscussion of the subject. He cites a few instances in which attempts were made to\napply the practice of senatorial courtesy to nominations to national offices, though\nit is clear that he does not approve of such application. He refers to the Rublee\nincident in 1916, and states that Senator La Follette, in challenging Senator Gallinger\xe2\x80\x99s request for application of the practice, declared that \xe2\x80\x9cthis was the first time\nsince he had been in the Senate that the \xe2\x80\x98personally obnoxious\xe2\x80\x99 rule had been\napplied to a national appointment.\xe2\x80\x9d 2 George H. Haynes, The Senate of the United\nStates: Its History and Practice 741 n.2 (1938).\nAs the Rublee incident shows, individual senators have not at all times agreed\nupon the extent to which the practice should be applied. Senatorial courtesy is,\nafter all, simply based on custom, the boundaries of which may change from time\nto time, and which can never be said to be subject to exact definition. If a senator\nwishes to do so, he may object to any nomination on whatever ground he sees fit.\nHis colleagues in the Senate will then judge whether these objections should be\ngiven weight. The purpose of this memorandum is to point out that the views\nexpressed in recent years by some of the leading members of the Senate and by\ntext writers have tended in the direction of limiting the practice to local offices.\nSuch examination of the actual precedents in the Senate as has been made in\nthe limited time at my disposal appears to indicate that senators have from time to\ntime attempted to invoke the practice of senatorial courtesy in respect of offices of\nnational importance, and that in a few cases the Senate has in fact failed to confirm\nthe nominee. In most, if not all, of these instances, however, it would appear that\nthe Senate\xe2\x80\x99s action was based on considerations independent of the objection so\nraised. In no case which has come to my attention\xe2\x80\x94not even the Rublee case\xe2\x80\x94\n\n91\n\n\x0cSupplemental Opinions of the Office of Legal Counsel in Volume 1\n\ndoes it appear that such a nomination was rejected solely on the ground of\nsenatorial courtesy.\nOSCAR S. COX\nAssistant Solicitor General\n\n92\n\n\x0c'


b'Reconsideration of Applicability of the Davis-Bacon Act to the\nVeterans Administration\xe2\x80\x99s Lease of Medical Facilities\n\nC o n tra ry to the v iew e x p re sse d in an e a rlie r o p in io n o f th e O ffice o f L egal C o u n se l, the p la in la n g u a g e\no f the D a v is-B a c o n A ct d o e s not b a r its a p p lic a tio n to a lease c o n tra c t o n th e g ro u n d th a t such\nc o n tra c ts are p e r s e not c o n tra c ts fo r c o n stru ctio n . T h e a p p lic a b ility o f the D a v is-B a c o n A c t to any\nsp e c ific lease c o n tra c t c an b e d e te rm in e d o n ly by c o n sid e rin g the d e ta ils o f the p a rtic u la r c o n tra c t.\n\nM ay 23, 1994\nM e m o r a n d u m O p i n i o n f o r t h e S o l ic it o r\nD epa r tm en t o f L abo r\nand\n\nT h e G eneral C o unsel\nD e p a r t m e n t o f V e t e r a n s A f f a ir s\n\nAt the request of the Attorney General, we have reviewed the principles and\nreasoning of a 1988 Office of Legal Counsel opinion concluding that the DavisBacon Act did not cover a contract entered into by the Veterans Administration\n(now Department of Veterans Affairs) (\xe2\x80\x9cVA\xe2\x80\x9d) for the long-term lease and con\xc2\xad\nstruction of a building to be used as an outpatient clinic. Applicability o f the\nDavis-Bacon A ct to the Veterans Adm inistration\xe2\x80\x99s Lease o f M edical Facilities, 12\nOp. O.L.C. 89 (1988) (\xe2\x80\x9c 1988 O.L.C. Opinion,\xe2\x80\x9d or \xe2\x80\x9c 1988 Opinion\xe2\x80\x9d). We have\nconcluded that the 1988 Opinion erred in concluding that the plain language of the\nDavis-Bacon Act bars its application to any lease contract, whether or not the lease\ncontract also calls for construction of a public work or public building. We believe\nthat the applicability of the Davis-Bacon Act to any specific lease contract can be\ndetermined only by considering the facts of the particular contract.\nI.\nThe 1988 O.L.C. opinion arose out of a dispute between the VA and the De\xc2\xad\npartment of Labor. The VA had entered into a contract (the \xe2\x80\x9cCrown Point con\xc2\xad\ntract\xe2\x80\x9d) with a developer for the long-term lease of space for use as a VA health\nclinic, in a building that the developer would build to house the clinic. In re Appli\xc2\xad\ncability o f Davis-Bacon Act to Lease o f Space fo r Outpatient Clinic, Crown Point,\nIndiana, WAB Case No. 86-33, 1987 WL 247049, at 2 (W.A.B. June 26, 1987)\n\n(\xe2\x80\x9c 1987 WAB Opinion\xe2\x80\x9d). The dispute concerned whether the contract was covered\nby the Davis-Bacon Act. That Act applies to\nevery contract in excess of $2,000 to which the United States or the\nDistrict of Columbia is a party, for construction, alteration, and/or\n109\n\n\x0cO pinions o f the O ffice o f L egal C ounsel\n\nrepair, including painting and decorating, of public buildings or\npublic works . . . .\n40 U.S.C. \xc2\xa7 276a(a). The Act provides that such contracts shall include provisions\nthat mechanics and laborers employed on these projects be paid prevailing wages\nto be determined by the Secretary o f Labor. Id.\nAlthough the Crown Point\ncontract called for the lease of clinic space, it also included numerous provisions\nrequiring that the building be constructed according to VA specifications, on a\nVA timetable, and subject to VA inspection. 1987 WAB Opinion at 4-5. Nonethe\xc2\xad\nless, the VA had concluded that the Act did not apply to the Crown Point agree\xc2\xad\nment because it was a lease and, in the VA\xe2\x80\x99s view, a lease is not a \xe2\x80\x9ccontract. . . for\nconstruction\xe2\x80\x9d under the Act. Therefore, the contract contained no provisions man\xc2\xad\ndating compliance with the prevailing wage requirements of the Davis-Bacon Act.\nUpon learning of VA\xe2\x80\x99s plans, the Building and Construction Trades Department\nof the AFL-CIO requested a ruling from the Wage and Hour Administrator of the\nDepartment of Labor that the construction of the building was covered by the\nDavis-Bacon Act. The Administrator, applying the Wage Appeals Board\xe2\x80\x99s\n(\xe2\x80\x9cWAB\xe2\x80\x9d) analysis in a similar case, agreed that the contract should have included\nDavis-Bacon prevailing wage provisions. See 1987 WAB Opinion at 1-2 (noting\nAdministrator\xe2\x80\x99s reliance on In re M ilitary Housing, Ft. Drum, WAB Case No. 8516 (Aug. 23, 1985)). The VA appealed to the WAB, which upheld the Adminis\xc2\xad\ntrator\xe2\x80\x99s action. Id.\nHowever, the VA continued to resist the Department of Labor\xe2\x80\x99s interpretation\nof the Act. While the AFL-CIO sought a court judgment to compel the VA to\ncomply with the W AB\xe2\x80\x99s decision, the VA sought an opinion from the Attorney\nGeneral that the WAB had misread the law. The result was a court determination\nthat the WAB decision was a reasonable interpretation of ambiguous language in\nthe Act under Chevron, U.S.A., Inc. v. Natural Resources Defense Council, Inc.,\n467 U.S. 837 (1984), Building and Constr. Trades D e p \xe2\x80\x99t, AFL-CIO v. Turnage,\n705 F. Supp. 5 (D.D.C. 1988), and an O.L.C. ruling that the WAB decision con\xc2\xad\nflicted with the plain language of the Act (the 1988 Opinion). The Department of\nJustice did not appeal the Turnage case because of the confused procedural posture\nit presented, but instructed Labor to comply with the reasoning of the 1988 O.L.C.\nopinion in future cases. Letter for Jerry G. Thorn, Acting Solicitor, Department of\nLabor, from Douglas W. Kmiec, Assistant Attorney General, Office of Legal\nCounsel (Jan. 23, 1989).\nYou have asked that we review our ruling in the 1988 Opinion that the plain\nlanguage and legislative history of the Davis-Bacon Act indicate that the Act does\nnot extend to leases. We have reviewed the prior opinion, solicited the views of\naffected executive departments, and conducted a thorough review of the legislative\nhistory, case law, and executive, judicial, and congressional interpretations of the\nAct. We have concluded that the portion of the 1988 Opinion that addressed the\n110\n\n\x0cReconsideration o f A pplicability o f the D avis-B acon A ct lo the\nV eterans A dm inistration\'s Lease o f M edical F acilities\n\nmeaning of the Davis-Bacon Act was incorrect. We do not, however, address the\nquestion whether the particular contract at issue in that case was a contract for con\xc2\xad\nstruction of a public work within the meaning of the Davis-Bacon Act, because the\ndecision not to appeal the ruling in the Turnage case has mooted the point. Nev\xc2\xad\nertheless, we can say that the fact that a contract is a lease is not the sole determi\xc2\xad\nnative factor in deciding whether that contract is also a contract for construction\nwithin the meaning of the Davis-Bacon Act.\nII.\n\nThe 1988 OLC Opinion concluded that a lease-construction contract for a Vet\xc2\xad\nerans Administration outpatient clinic was not a contract for construction of a pub\xc2\xad\nlic building or public work within the meaning of the Davis-Bacon Act, because\nthe plain meaning of the term \xe2\x80\x9ccontract . . . for construction\xe2\x80\x9d could not be read to\ninclude a lease, even one that contemplated, and resulted in, the construction of a\nbuilding for long-term public use.\nWe do not think the question is so simple. The words \xe2\x80\x9ccontract . . . for con\xc2\xad\nstruction . . . of public buildings or public works\xe2\x80\x9d do not plainly and precisely indi\xc2\xad\ncate that a contract must include provisions dealing only with construction. Rather,\nthe plain language would seem to require only that there be a contract, and that one\nof the things required by that contract be construction of a public work. This inter\xc2\xad\npretation of the Act is supported not only by its language, but also by the legisla\xc2\xad\ntive history, by reference to the goals of the Act, by judicial and executive\ninterpretation of the Act, and by the interpretation of similar language in related\nActs.\nA.\nSince the 1988 Opinion rested on its reading of the plain language of the Act,\nwe begin by setting forth that language. The Act provides that\n[t]he advertised specifications for every contract in excess of\n$2,000, to which the United States or the District of Columbia is a\nparty, for construction, alteration, and/or repair, including painting\nand decorating, of public buildings or public works of the United\nStates or the District of Columbia . . . which requires or involves the\nemployment of mechanics and/or laborers shall contain a provision\nstating the minimum wages to be paid various classes of laborers\nand mechanics which shall be based upon the wages that will be\ndetermined by the Secretary of Labor to be prevailing for the corre\xc2\xad\nsponding classes of laborers and mechanics employed on projects of\n\n111\n\n\x0cO pinions o f the O ffice o f L egal C ounsel\n\na character similar to the contract work in the [area where] the work\nis to be performed . . . .\n40 U.S.C. \xc2\xa7 276a(a).\'\nThe 1988 Opinion concluded that this language \xe2\x80\x9cplainly and precisely\xe2\x80\x9d limited\nthe A ct\xe2\x80\x99s coverage to \xe2\x80\x9cconstruction contracts,\xe2\x80\x9d and thus could not be read to\ninclude a lease. 1988 Opinion at 93-94.2 While this may be true so far as it goes,\nwe do not think the term \xe2\x80\x9cconstruction contract\xe2\x80\x9d sheds much light on the meaning\nof the more elaborate statutory term \xe2\x80\x9ccontract . . . for construction, alteration,\nand/or repair, including painting and decorating.\xe2\x80\x9d In particular, we do not think\nthe term \xe2\x80\x9cconstruction contract,\xe2\x80\x9d any more than the term \xe2\x80\x9ccontract . . . for\n\n1 A n e arlier v ersion o f the A ct provided for c o v erag e o f\ne v ery c o n tra c t in excess o f $5,000 in am o u n t, to w hich the U nited S tates or the D istrict of C o \xc2\xad\nlu m b ia is a party, w hich requires or in v o lv e s the em p lo y m ent o f laborers or m echanics in the\nc o n stru ctio n , alteration, an d /o r repair o f a n y public b u ild in g s o f the U nited Slates.\nD avis-B aco n A ct, ch . 4 1 1 , \xc2\xa7 1, 4 6 Stat. 1494, 1494 (1931) S e e A rm and J Thieblot, Jr., P revailing Wage\nL e gislatio n . The D a v is-B a c o n Act, State "L ittle D avis-B acon \xe2\x80\x9d A cts, the W alsh-H ealey Act, a nd the Service\nC o ntract A c t 31 (1 9 8 6 ) ( \xe2\x80\x9cT h ieb lo t\xe2\x80\x9d)\nT he A ct w as rev ised in 1935 to add coverage o f public w orks and o f p a in tin g and decorating contracts, to\nlow er the c o n tra c t th resh o ld from $5,000 to $ 2 ,0 0 0 (to reflect the relatively sm all dollar value o f p ainting and\ndecoratin g c o n tracts), to p ro v id e for predeterm ination o f w age rates by the D epartm ent o f Labor, and to\nprovide fo r re m e d ie s fo r w orkers not paid the p ro p e r rates on covered contracts See S. R ep No. 74-1155\n(1935), H R R ep N o. 7 4 -1 7 5 6 (1935); T h ieb lo t at 3, 28, 2 9 (discussing purpose o f A ct); id at 32-34\n(discussin g 1935 am en d m en ts)\nT here is no suggestion in the legislative history that the sw itch from\n\xe2\x80\x9cc o n tract\n. w h ich requires o r involves the em p lo y m en t o f laborers or m echanics in .\nconstruction\xe2\x80\x9d to the\ncurrent lan g u ag e o f \xe2\x80\x9cco n tract . . . fo r construction . . . w hich requires o r involves the em ploym ent o f me\xc2\xad\nchanics an d /o r la b o re rs\xe2\x80\x9d w as intended to have an y narrow ing effect See, e.g , S R ep No. 1155; H R Rep\nNo. 7 4 -1 7 5 6 T he A ct w as m o d ified again in 1964 to include fringe benefits in the calculation of prevailing\nw ages S ee S R ep. N o 88-963 (1964), rep rin ted in 1964 U .S .C C A N 2339; T hieblot at 34.\nT h e 7 4 th C o n g re ss \xe2\x80\x94 the sam e one that a m e n d ed the D avis-B acon A ct to include the language at issue\nhere (A ct o f A ug. 30, 1935, ch 825, \xc2\xa7 I, 49 S tat 1011) \xe2\x80\x94 also passed the closely related M iller Act, 40\nU S C \xc2\xa7 2 7 0 a (A ct o f A ug 24, 1935, ch. 642, \xc2\xa7 1, 49 Stat. 7 93). The M iller Act provides lhat contractors\nshall furnish b o n d s on \xe2\x80\x9c any con tract, exceeding $25,000 in am ount, for the construction, alteration, or repair\no f any p u b lic b u ild in g o r public w ork \xe2\x80\x9d The lan g u ag e o f the M iller Act is a lm ost identical to that used in the\n1935 am en d m en ts lo ihe D av is-B aco n Act th en being co n sid ered , and the M iller A ct originally included the\nsam e $ 2 ,0 0 0 th resh o ld as the 1935 D avis-B acon A ct T h ieb lo t at 37 n 40 , U niversities Research A s s \'n v.\nCoutit, 4 5 0 U .S 7 5 4 ,7 5 8 -5 9 (1981). See a lso S Rep No. 74-1155, at 4 , H.R Rep N o 74-1756, at 4, 5\n(noting relatio n b e tw ee n D av is-B aco n am endm ents and the H eard Act (w hich the M iller Act replaced))\nT h e n early identical language o f the M iller A c t has been applied lo c onstruction even o f public w orks that\nw ould be p riv ately ow ned, see, e g . U nited S ta tes ex rel N o land C o v Irw in, 316 U S 23 (1942)\n(construction o f H ow ard U niversity library), a n d to the relocation o f a privately-ow ned railroad that w ould be\nflooded by a federal d am , P eterso n v. United S ta te s , 119 F.2d 145 (6th C ir 1941) T hese cases focused on\nw hether the co n stru ctio n in q u estio n was o f a public w ork; ihere seem s to have been no challenge on the\nbasis th a i the c o n tracts w ere not for construction The one difference in language betw een the M iller and\nD avis-B aco n A cts \xe2\x80\x94 lhat the Davis-Bacon A c t refers to c o n tracts \xe2\x80\x9cto w hich the U nited Stales or ihe D istrict\no f C o lu m b ia is a p a rty ,\xe2\x80\x9d 4 0 U S C. \xc2\xa7 276a(a), w hile the M iller A ct does not, see 4 0 U.S C \xc2\xa7 270a(a) \xe2\x80\x94 is\nnot sig n ific a n t in th is setting, since the U nited States is undeniably a party to the contract to build and lease\nthe C row n Poini facility; the d ifficulty is tn d eterm in in g w hat sort o f contract that contract is.\n\xe2\x96\xa0 T h e 1988 O p in io n does not indicate w here the new term \xe2\x80\x9cconstruction contracts\xe2\x80\x9d com es from. It is not\na technical term d ra w n from case law interpreting the D avis-B acon A ct, or used elsew here as a m eans of\nexplainin g w h at the A ct covers o r does not c o v e r R ather, it appears to be an im provised shorthand for the\nm ore ela b o ra te statu to ry language. We can see no ju stificatio n for using a shorthand phrase neither endorsed\nby C o n g re ss n or ex p la in ed in ihe case law to b u ttress a narrow reading o f the statutory language\n\n112\n\n\x0cReconsideration o f A pplicability o f the D avis-B acon A ct to the\nVeterans A dm inistration s Lease o f M edical F acilities\n\nconstruction,\xe2\x80\x9d unambiguously excludes a contract for the long-term lease of a\nbuilding to be constructed to comply with the contract, especially when the con\xc2\xad\ntracting agency contemplates the construction of a new building and includes sub\xc2\xad\nstantial provisions concerning construction in the contract. Even prominent critics\nof the Act have conceded as much. See, e.g., Thieblot at 39 n.50 (\xe2\x80\x9cIn some cir\xc2\xad\ncumstances, privately financed construction may be subject to prevailing wage\nrequirements if, for example, the facilities are specially constructed with the inten\xc2\xad\ntion of leasing them to government occupants.\xe2\x80\x9d). To rule otherwise would leave\nsubstantial room for agencies to evade the requirements of the Act by contracting\nfor long-term lease rather than outright ownership of public buildings and public\nworks.\nThe Crown Point lease provides a good illustration of the principle that a\nlease may look very much like a \xe2\x80\x9ccontract . . . for construction.\xe2\x80\x9d3 According to\nthe 1987 WAB Opinion, the Solicitation for Offer \xe2\x80\x9cspecifically provides for lease\nof a building to be \xe2\x80\x98constructed in accordance with VA specifications.\xe2\x80\x99\xe2\x80\x9d Id. at 3.\nThe requirements under the Solicitation include \xe2\x80\x9cpreliminary plans and specifica\xc2\xad\ntions; other working drawings; issuance of a building permit; completed construc\xc2\xad\ntion documents; start of construction; completion of principal categories of work;\nphase completion; and final construction completion;\xe2\x80\x9d along with \xe2\x80\x9cname and expe\xc2\xad\nrience of the proposed construction contractor,\xe2\x80\x9d and \xe2\x80\x9cevidence of award of the\nconstruction contract within 15 days of award.\xe2\x80\x9d Id. Under the terms of the Solici\xc2\xad\ntation, the winning bidder would be required to submit construction progress re\xc2\xad\nports to the VA and to allow the VA to inspect the site. Id. All of these\nrequirements indicate that while the contract was labeled a lease, it called for the\nconstruction of a building, at least as one expected means of satisfying the terms of\nthe contract. To say that the contract is not \xe2\x80\x9cfor construction\xe2\x80\x9d ignores what the\ncontract itself says.\nIn short, to regard all lease-construction contracts as outside the scope of the\nDavis-Bacon Act is contrary to the plain language of the Act: many such leases are\nin fact contracts that call for the construction of a public work. The difficulty is in\ndetermining whether a particular lease is really a contract for construction of a\npublic building or public work, or just a contract to secure the use of private prem\xc2\xad\nises on a temporary basis. \xe2\x80\x9cPlain language\xe2\x80\x9d is of little use in policing this border\xc2\xad\nline.\n\n1\nT here can be no question that a lease is a contract, obliging each party to take certain actions S e e 1\nA rthur Linton C orbin, C orbin on C o m m its Sfc 1 2-1 3 (rev ed , Joseph M Penllo, ed , 1993) (defining\n\xe2\x80\x9c legal oblig atio n \xe2\x80\x9d and \xe2\x80\x9ccontract,\xe2\x80\x9d respectively); A la ska v. U nited States\', 16 Cl Ct. 5 (1988) (docum ent need\nno t be labeled a contract to be a contract) The real question is w hether such a contract is \xe2\x80\x9c for construction.\'*\n\n113\n\n\x0cOpinions o f th e Office o f L egal C ounsel\n\nB.\nThe legislative history and the purposes of the Act strongly support this inter\xc2\xad\npretation as well. The Act was passed in 1931, and amended in 1935, to ensure\nthat contractors bidding on public works projects would not lower wages so as to\nbe sure to make the lowest bid; and to permit government agencies, which were\nrequired to accept the lowest bids, to employ contractors who paid a \xe2\x80\x9cfair\xe2\x80\x9d wage\nrather than those who competed by reducing wage rates. S. Rep. No. 74-1155,\n(1935); H.R. Rep. No. 74-1756 (1935); S. Rep. No. 71-1445, at 1-2 (1931); H.R.\nRep. No. 71-2453, at 1-2 (1931 );4 see also 74 Cong. Rec. 6505 (1931) (remarks of\nRep. Welch). The sponsor, Representative Bacon, justified the bill by stating that\nthe \xe2\x80\x9cGovernment must not be put in the position of helping to demoralize the local\nlabor market.\xe2\x80\x9d5\nThe Davis-Bacon Act was passed during the Depression, when federal con\xc2\xad\nstruction accounted for a large portion of construction overall6 and workers des\xc2\xad\nperate to take any job could be hired at wages far below those available in the\npast.7 The result was a concern that the federal public works program would not\nachieve its desired effect of assisting local communities in regaining prosperity, but\ninstead would allow contractors \xe2\x80\x94 and indeed the government itself \xe2\x80\x94 to exploit\n\n4 T h e se rep o rts staled that\nT h e F ederal G o v e rn m e n t has entered u p o n an extensive public bu ild in g program\n. intended [in\npart] . . to b en efit the U nited States at larg e through d istrib ution o f construction throughout the\nco m m u n ities o f the co u n try without fav o rin g any p articu lar section\nT h e Federal G o v ern m en t m ust, under th e law, aw ard its co n tracts to the low est responsible bid \xc2\xad\nd e r T h is has p rev en ted representatives o f the d ep artm en ts involved from requiring successful\nb idders to pay w ages to their employees com parable to the w ages paid for sim ilar labor by pri\xc2\xad\nvate in d u stry in the v icin ity o f the b u ild in g projects un d er construction.\n[SJom e successful\nb id d ers have selfish ly im ported labor fro m distant localities and have exploited this labor at\nw ag es far b elow local w age rates\nT h is practice, w hich the Federal G overnm ent is now pow erless to stop, has resulted in a very u n \xc2\xad\nh ealth y situ atio n . Local artisans and m echanics, m any o f w hom are fam ily m en . . can not hope\nto co m p ete w ith this m igratory labor N o t only are local w orkm en affected, but qualified c o n \xc2\xad\ntra c to rs resid in g and d o in g business in th e section o f the co untry to w hich Federal buildings are\na llo cated find it im possible to compete w ith the o u tsid e co n tractors, w ho base th eir estim ates for\nlab o r upon the low w ages they can pay to unattached, m igratory w orkm en . . . .\nS R ep. No. 7 1 -1 4 4 5 , at 1-2; H .R. Rep No. 7 1 -2 4 5 3 , at 1-2.\n5 74 C o n g R ec. 6 5 1 0 (1 9 3 1 ). See also S. R ep No. 74 -1 1 5 5 , at 1-2, H .R Rep. N o. 74-1756, at 1 (both\nstating that the a m en d m en ts w ere needed to m ake the A ct m ore enforceable, because \xe2\x80\x9c unscrupulous con\xc2\xad\ntractors have taken ad v an tag e o f the w ide-spread unem ploym ent am ong the buildings crafts to exploit labor\nand to d ep riv e em p lo y ees o f the w ages to w h ich they w ere en titled under the law \xe2\x80\x99\xe2\x80\x99); S. Rep. No. 88-963, at 1,\n2 (1 9 6 4 ), r ep rin te d mi 1964 U S C C.A N 2 3 3 9 , 2340 (rev iew in g the purposes of the A ct), T hieb lo t at 3, 28,\n29, 32-34 (rev ie w in g the p u rposes o f this and related acts and d iscussing the 1935 am endm ents).\n6 See, e.g ., T h ieb lo t at 29, 29 n. 18 (betw een 1929 and 1933, pu blic construction rose from less than oneq u a rte r to m ore than o n e -h a lf o f all construction nationw ide); S Rep. No. 71-1445, at I (1931) (federal\ngo vern m en t h a s em b a rk e d on new , large-scale public w orks co n stru ctio n program ); H R R ep N o. 71-2453,\nat 1 (1 9 3 1 ) (sa m e), 74 C ong. R ec 6 5 11 (1931) (rem arks o f Rep. B acon) (sam e).\n7 See, e g , T h ieb lo t at 28 (indicating th a t average con stru ction w ages had fallen to h a lf their preD epression rates by 1931); 74 C ong Rec 6 5 1 0 (1931) (rem ark s o f Rep. Johnson hypothesizing w age reduc\xc2\xad\ntion fro m $4 to $2 75 p er d ay )\n\n114\n\n\x0cReconsideration o f A pplicability o f the D avis-B acon A ct to the\nVeterans A dm inistration\'s Lease o f M edical F acilities\n\ndesperate laborers, in some cases imported from other parts of the country.8 While\nCongress was presented with evidence that the loss of jobs to outsiders was rare,\nsee 74 Cong. Rec. at 6506 (chart noting origins of workers on public building proj\xc2\xad\nects), the evidence before Congress also showed that it did occur. Representative\nBacon, for example, who sponsored the bill in the House, saw a contract for a Vet\xc2\xad\nerans\xe2\x80\x99 Bureau hospital in his district go to an outside contractor who employed\nlaborers from Alabama, \xe2\x80\x9chuddled in shacks living under most wretched conditions\nand being paid wages far below the standard,\xe2\x80\x9d 74 Cong. Rec. at 6510 (statement of\nRep. LaGuardia). Meanwhile, unemployed workers in Representative Bacon\xe2\x80\x99s\nown community apparently remained jobless, unable or unwilling to compete for\njobs with those willing to accept the substandard conditions.\nThis view of the purposes of the Act \xe2\x80\x94 that government should not act to de\xc2\xad\npress labor conditions, but should ensure that government and government con\xc2\xad\ntractors employ workers at fair wages \xe2\x80\x94 continues to prevail. See, e.g., Walsh v.\nSchlecht, 429 U.S. 401, 411 (1977) (Davis-Bacon protects workers, not contrac\xc2\xad\ntors, setting a floor but not a ceiling for wage rates); United States v. Binghamton\nConstr. Co., 347 U.S. 171, 177 (1954) (same), Unity Bank <& Trust Co. v. United\nStates, 756 F.2d 870, 873 (Fed. Cir. 1985) (same); Building and Constr. Trades\nD e p \xe2\x80\x99t, AFL-CIO v. Donovan, 712 F.2d 611, 613-14, 620-21 (D.C. Cir. 1983)\n(noting that Davis-Bacon was designed to counteract the potential effect of the\ngovernment\xe2\x80\x99s low-bid requirement on wages), cert, denied, 464 U.S. 1069 (1984).9\nIn view of these purposes, we believe that the device of lease-construction, at least\nto the extent that it is used to build public works outside the prevailing wage sys\xc2\xad\ntem, lies well within the contours of the Act. Whether the government construction\nis paid for upfront or by means of a long-term lease is of no significance to workers\n\n8 See. e g , S Rep No. 7 4 -1 155, at 2, H.R Rep No. 71-2453, at 2, 74 C ong Rec at 6510 Som e com m entators have suggested that the purposes o f ihe Act w ere not al! benign and lhat som e o f ihe concern about\noutside labor m ay have been based on the fact that som e o f the new com petition for jo b s cam e from black\nw orkers See T hieblot at 30, David E Bernstein, Roots o f the \xe2\x80\x98U n d e rc la ss\xe2\x80\x99 The D ecline o j L aissez-F aire\nJurispru d en ce a n d the R ise o f Racist L a b o r L e g isla tio n, 43 Am. U L Rev 85, 1 14-16 (1993) (arguing that\nD avis-B acon reinforced labor u nions\xe2\x80\x99 discrim ination a g ain st black w orkers by elim inating nonunion w ork\xc2\xad\ne rs \xe2\x80\x99 ability lo com pete by offering to work for low er w ages), 74 C ong. Rec at 6513 (rem arks o f Rep. A ll\xc2\xad\ngood). Indeed, ihe contract to build the V eterans\' hospital in R epresentative B ac o n \'s d istrict w ent lo an\nA labam a co n tracto r w ho b rought black laborers to Long Island to build the project B ernstein at 114, see\nalso 74 C ong Rec. at 6513 (rem arks o f Rep A llgood, apparently concerning the project in R ep. B aco n \xe2\x80\x99s\ndistrict) O th er C ongressm en, how ever, w ithout discussing the race o f the w orkers involved, argued that the\nim ported w orkers were being exploited by the substandard w age rates and w orking conditions. See, e.g , 74\nC ong. Rec at 6 5 1 0 (rem arks o f Rep L aG uardia concerning the situation in Rep B aco n \'s district)\n9 See also T hieblot at 122-23 (quoting D avis-B acon W orks a n d W orks W ellr: A n Interview w ith Jorm er\nU.S. L a b o r S ecreta ry Ray M arshall, 3 B uilders Special Rep (M arch 7, 1981), in turn quoting Secretary\nM arshall as staling lhat \xe2\x80\x98\xe2\x80\x98[i]he basic rationale for ihe D avis-B acon law is really quite sim ple It is based on\nthe idea that the federal governm ent should not use ta x p a y ers\xe2\x80\x99 m oney to undercut local area em ploym ent\nconditions\n[I]f the federal governm ent perm itted its construction dollars lo be used [in this way to]\nundercut prevailing pay standards[, w]e w ould be helping to drive dow n w ages in any com m unity in which\nsuch federal o r federally-assisted construction was taking place . ")\n\n115\n\n\x0cOpinions o f the Office o f Legal C ounsel\n\nwho must take lower pay or to local contractors forced to compete by cutting labor\ncosts. The effect on them is the same.\nWhile the public generally has an undeniable interest in paying as little as pos\xc2\xad\nsible for the construction of public works, the purpose of the Davis-Bacon Act was\nprecisely to subordinate that interest to the extent necessary to set minimum wage\nstandards for such construction work. If an agency decides to construct a public\nwork \xe2\x80\x94 not just acquire a privately-owned building \xe2\x80\x94 that agency cannot evade\nthe purposes of this country\xe2\x80\x99s labor laws by clever drafting. This does not mean\nthat construction related to any lease is \xe2\x80\x9cconstruction, alteration and/or repair\xe2\x80\x9d of a\npublic work within the meaning of the Act \xe2\x80\x94 but neither can the \xe2\x80\x9cplain language\xe2\x80\x9d\nof the Act be read as declaring that a 99-year lease of a brand new building that\nwould never otherwise have been built is not the construction of a public work.\nThe answer in any particular case will depend on the facts.\nC.\nThe Department of Labor\xe2\x80\x99s longstanding interpretation of the Davis-Bacon Act\nis designed to counteract just such evasion, and the views of the courts, Comptrol\xc2\xad\nlers General, and Attorneys General, with few exceptions, support this interpreta\xc2\xad\ntion of the Act.\nThe Department of Labor consistently has taken the position that a contract is a\ncontract for construction within the meaning of the Davis-Bacon Act \xe2\x80\x9cif more than\nan incidental amount of construction-type activity is involved in the performance\nof a government contract.\xe2\x80\x9d 1987 WAB Opinion at 2 (quoting In re Military\nHousing, Ft. Drum, WAB Case No. 85-16, at 4 (Aug. 23, 1985)). Similarly, the\nFederal Acquisition Regulations instruct agencies that Davis-Bacon wage rates\nshould be included in nonconstruction contracts involving some construction work\nwhen \xe2\x80\x9c[t]he contract contains specific requirements for a substantial amount of\nconstruction work,\xe2\x80\x9d 48 C.F.R. \xc2\xa7 22.402(b)(ii) (1994), which is \xe2\x80\x9cphysically or\nfunctionally separate from, and is capable of being performed on a segregated basis\nfrom, the other work required by the contract,\xe2\x80\x9d 48 C.F.R. \xc2\xa7 22.402(b)(iii). See\nalso 29 C.F.R. \xc2\xa7 4 .1 16(c)(2) (1994) (providing that Davis-Bacon wage rates shall\napply in similar circumstances in contracts otherwise covered by the wage and hour\nprovisions of the Service Contract Act).\nThis interpretation has been approved by the Comptroller General. In re\nFischer E n g\xe2\x80\x99g & Maintenance Co., No. B-223359, 1986 WL 64093, at 2 (C.G.\nSept. 16, 1986) (Davis-Bacon applies to lease-construction of military housing, so\nlong as project is \xe2\x80\x9cclothed sufficiently with elements indicating that [it] indeed . . .\nserv[es] a public purpose\xe2\x80\x9d); In re D.E. Clarke, No. B-146824, 1975 WL 8417, at 1\n(C.G. May 28, 1975) (contract is covered if it \xe2\x80\x9cessentially or substantially contem\xc2\xad\nplates the performance of work described by the enumerated items\xe2\x80\x9d); 40 Comp.\nGen. 565, 565, 567 (1961) (\xe2\x80\x9c[t]he test for determination of the applicability of the\n116\n\n\x0cR econsideration o f A pplicability o f the D avis-B acon A ct to the\nVeterans A dm inistration\'s Lease o f M edical Facilities\n\nDavis-Bacon Act . . . is not the nature of the specific work but the nature of the\ncontract, that is, whether the contract essentially or substantially contemplates the\nperformance of work described by the enumerated items \xe2\x80\x98construction, alteration,\nand/or repair, including painting and decorating\xe2\x80\x99\xe2\x80\x9d; applying this standard to a con\xc2\xad\ntract ostensibly dealing with \xe2\x80\x9cmaintenance,\xe2\x80\x9d the Comptroller General ultimately\ndetermined that the work required was in fact maintenance rather than construc\xc2\xad\ntion); 34 Comp. Gen. 697 (1955) (lease-purchase agreements fall within the DavisBacon and related Acts); 10 Comp. Gen. 461 (1931) (Act applies to temporary\nhousing and other buildings erected for use during construction of the Hoover\nDam).\nThe 1988 O.L.C. Opinion, however, relied heavily on a 1962 Comptroller Gen\xc2\xad\neral opinion at odds with the Comptroller\xe2\x80\x99s other cases, without discussing the\nmore recent cases. In that opinion, the Comptroller General argued that leases are\nnever contracts for the construction of public works. 42 Comp. Gen. 47 (1962).\nThe 1962 opinion addressed the concept of lease and lease-option contracts in the\nabstract, and concluded that such contracts are not Davis-Bacon contracts because\n\xe2\x80\x9cof the basic distinction which exists between the procurement of a right to use\nimprovements, even though constructed for that particular usage, and the actual\nprocurement of such improvements.\xe2\x80\x9d Id. at 49. The opinion asserted that \xe2\x80\x9cthe\nmere fact that construction work is prerequisite to supplying a public need or use\ndoes not give such work a Davis-Bacon status.\xe2\x80\x9d Id. In rejecting such a sweeping\ninterpretation of the Davis-Bacon Act, the Comptroller General unnecessarily sug\xc2\xad\ngested that no leases are covered unless the government ultimately acquires title to\nthe work. In contrast, the Attorney General had already determined that acquisi\xc2\xad\ntion of title was not necessary to bring a contract within the Davis-Bacon Act,\nWage Law Applicable to Alley Dwelling Authority fo r the District o f Columbia, 38\nOp. Att\xe2\x80\x99y Gen. 229, 233 (1935); and the courts had reached the same conclusion in\nconstruing the nearly identical language of the closely related Miller Act, e.g.,\nUnited States ex rel. Noland Co. v. Irwin, 316 U.S. 23 (1942) (construction of\nHoward University library).\nIn a later opinion, the Comptroller General emphatically rejected the 1962\nopinion\xe2\x80\x99s reading of the statute, approving instead the Department of Labor\xe2\x80\x99s\nanalysis of a particular lease-construction contract similar to the one involved in\nthe 1988 O.L.C. Opinion. In re Fischer Eng\xe2\x80\x99g & Maintenance Co., No. B223359, 1986 WL 64093 (C.G. Sept. 26, 1986). The Fischer Engineering case\nemphasized that the 1962 opinion had addressed the issue only in the abstract.\nEven were we to regard the decisions of the Comptroller General as controlling,\nwhich we do not, we think the reasoning of the more recent Fischer Engineering\ncase is both more consistent with other Comptroller General opinions and more\naccurate in its reading of the Act, because it is more attentive to the underlying\nintent of the Act.\n\n117\n\n\x0cOpinions o f th e O ffice o f L egal C ounsel\n\nSimilarly, the courts have identified the Davis-Bacon Act as a remedial statute\nthat should be \xe2\x80\x9cliberally construed to effectuate its beneficent purposes.\xe2\x80\x9d E.g.,\nDrivers Local Union No. 695 v. NLRB, 361 F.2d 547, 553 n.23 (D.C. Cir. 1966)\n(citing United States v. Binghamton Constr. Co., 347 U.S. 171, 177 (1954), for\nconclusion that statute is remedial). While the courts have not addressed the leaseconstruction contract situation directly, except in the Turnage case (which con\xc2\xad\ncluded that the Crown Point contract was covered by the Davis-Bacon Act), they\nhave made clear that public ownership is not essential for a finding that a contract\nis for construction of a public work under the related Miller Act. See, e.g., United\nStates ex rel. N oland Co. v. Irwin, 316 U.S. 23 (1942) (Howard University li\xc2\xad\nbrary). This and similar cases did not even consider the possibility that the con\xc2\xad\ntracts were not for construction; rather they focused on whether the construction\nwas of a public work, defining the term as \xe2\x80\x9cincluding \xe2\x80\x98any projects . . . carried on\neither directly by public authority or with public aid to serve the interests of the\ngeneral public.\xe2\x80\x99\xe2\x80\x9d Id. at 28, 30 (quoting the National Industrial Recovery Act\xe2\x80\x99s\ndefinition of \xe2\x80\x9cpublic work\xe2\x80\x9d and applying it to a Miller Act bond case). The classic\ndefinition of a public work for purposes of the Depression-era labor statutes was\nset forth in the case of Peterson v. United States, 119 F.2d 145 (6th Cir. 1941),\nwhich stated that\nThe term \xe2\x80\x9cpublic work\xe2\x80\x9d as used in the [Miller Act] is without tech\xc2\xad\nnical meaning and is to be understood in its plain, obvious and ra\xc2\xad\ntional sense. The Congress was not dealing with mere technicalities\nin the passage of the Act in question. \xe2\x80\x9cPublic work\xe2\x80\x9d as used in the\nact includes any work in which the United States is interested and\nwhich is done for the public and for which the United States is\nauthorized to expend funds.\n\nThere is nothing in [Title Guaranty & Trust Co. v. Crane Co., 219\nU.S. 24 (1910) (holding that ships are public works under predeces\xc2\xad\nsor Heard Act, though not on public soil, because they are publicly\nowned)] from which an inference may be drawn that ownership was\nthe sole criterion. To so circumscribe the act would destroy its\npurpose.\nId. at 147. See also 29 C.F.R. \xc2\xa7 5.2(k) (1994) (project is a public work if it is\n\n\xe2\x80\x9ccarried on directly by authority of or with funds of a Federal agency,\xe2\x80\x9d and\n\xe2\x80\x9cserve[s] the interest of the general public regardless of whether title thereof is in a\nFederal agency\xe2\x80\x9d).\nWhile Peterson and other cases do not address directly the question whether a\nlease-construction contract is covered by the Davis-Bacon Act, they do suggest that\na technical reading of the Act that defeats its purpose is inconsistent with the text\n118\n\n\x0cReconsideration o f A pplicability o f the D avis-B acon A ct to the\nVeterans A dm inistration\'s Lease o f M edical Facilities\n\nas well as the purpose of the Act. See also Title Guaranty & Trust Co. v. Crane\nCo., 219 U.S. 24 (1910) (ships are public works under Heard Act though not af\xc2\xad\nfixed to public property); Applicability o f Certain Acts to Construction, Alteration,\nand Repair o f Coast Guard Vessels, Boats, and Aircraft, 38 Op. Att\xe2\x80\x99y Gen. 418\n(1936) (same, under Davis-Bacon Act); Fidelity and Deposit Co. v. Harris, 360\nF.2d 402, 408 (9th Cir. 1966) (construction of building for the Jet Propulsion\nLaboratory at the California Institute of Technology is a public work under the\nMiller Act); Autrey v. Williams and Dunlap, 343 F.2d 730, 734 (5th Cir. 1965)\n(Capehart Housing Act military housing project is a public work under Miller Act,\n\xe2\x80\x9c[although title . . . does not pass immediately to the United States, due to the\nnovel financing plan\xe2\x80\x9d of the Capehart Act); United States ex rel. Gamerston &\nGreen Lumber Co. v. Phoenix Assurance Co., 163 F. Supp. 713 (N.D. Cal. 1958)\n(Miiler Act applies to construction of post library at the Presidio, though paid for\nfrom nonappropriated funds).10\nFinally, past Attorney General opinions also support a broad reading of the Act.\nSee, e.g., Federal Aid Highway Program \xe2\x80\x94 Prevailing Wage Determination, 41\nOp. Att\xe2\x80\x99y Gen. 488, 500-01 (1960) (definition of mechanics and laborers under\nDavis-Bacon Act \xe2\x80\x9cis not to be given a niggardly construction\xe2\x80\x9d because the Act \xe2\x80\x9cis\nto be interpreted broadly to accomplish its purpose\xe2\x80\x9d); Wage Law Applicable to\nAlley Dwelling Authority fo r the District o f Columbia, 38 Op. Att\xe2\x80\x99y Gen. 229, 233\n(1935) (\xe2\x80\x9cbroad construction\xe2\x80\x9d that Act covers buildings that may be resold to pri\xc2\xad\nvate parties is \xe2\x80\x9csupported both by the language of the Act and by the apparent pur\xc2\xad\n\n10\nT he 1988 O pinion did not address the question w hether the clinic construction called for u n d e r the\nC row n Point contract fell w ithin the definition o f a \xe2\x80\x9cpublic buildm g[] or public w ork[]\xe2\x80\x9d for purposes o f the\nD avis-B acon Act, and the status o f the C row n Point contract is no longer a m atter o f dispute in light of\nBuilding a n d C onstr. Trades D e p \xe2\x80\x99t, A F L -C IO v Turnage, 705 F. Supp 5 (D D C 1988) (holding lhat leaseconstruction o f V eterans A dm inistration outpatient clinic u n d er the C row n Point contract was c o v e re d by\nD avis-B acon). W ith respect to the C row n Point contract, how ever, we w ould note that v eterans\xe2\x80\x99 hospitals,\nw hen constructed under ordinary financing m echanism s, w ere am ong the principal public buildings that the\ndrafters had in mind, see, e.g , 74 C ong. Rec 6510-11 (1931) (rem arks o f R ep B acon), id at 6 5 0 6 (chart),\nand unquestionably serve a public purpose Furtherm ore, it is w ell established that the governm ent n eed not\nhave eith er initial o r perm anent title to a building for the construction project to be deem ed a public w ork\n(though governm ent-ow ned property presents an easier case) See, e.g.. W age Law A p p lica b le to A lley\nD w elling A u th o rity f o r the D istrict oj C olum bia, 38 Op. A tt\'y G en 229 (1935) (housing constructed under\nD C. A lley D w elling A uthority Act o f 1934 is a public work even though it may later be sold to p rivate p a r\xc2\xad\nties), U nited States ex rel. N oland Co v. In vin , 316 U S. 23, 2 9-30 (1942) (construction o f H ow ard U n iv e r\xc2\xad\nsity library is a public work under related M iller Act, though library w as to be the property o f a private\nuniversity), P eterson v. U nited States, 1 19 F 2d 145 (6th C ir 1941) (relocation of privately-ow ned railw ay\nthat w ould be flooded by federal d am is a public w ork) W e believe that, in general, the d eterm ination\nw hether a lease-construction contract calls for construction o f a public building or public work likely will\ndepend on the details o f the p articu lar arrangem ent. T hese m ay include such factors as the length o f the\nlease, the extent o f governm ent involvem ent in the construction project, the extent to w hich the c onstruction\nwill be used for private rather than public purposes, the extent to w hich the costs of construction will be fully\npaid for by the lease paym ents, and w hether the contract is w ritten as a lease solely to evade the requirem ents\no f the D avis-B acon Act, a possibility contem plated by the d issen ter from the 1987 W AB O pinion. H ow ever,\nwe further believe that the fact that a novel financing m echanism is em ployed should not in itself d efeat the\nreading o f such a contract as being a contract for construction o f a public building or public work.\n\n119\n\n\x0cOpinions o f th e Office o f L e g a l C ounsel\n\nposes intended to be accomplished\xe2\x80\x9d). The sole exception to this trend is the 1988\nO.L.C. Opinion.\nThe 1988 Opinion quoted language from the 1935 and 1960 Attorney General\nopinions to suggest that the use of direct federal funds was an absolute requirement\nfor Davis-Bacon coverage, citing a statement in the 1935 opinion that the Act ap\xc2\xad\nplied to \xe2\x80\x9cbuildings erected with funds supplied by the Congress,\xe2\x80\x9d 38 Op. Att\xe2\x80\x99y\nGen. at 233, and a statement in the 1960 opinion that it applied to \xe2\x80\x9cdirect Federal\nconstruction,\xe2\x80\x9d 41 Op. Att\xe2\x80\x99y Gen. at 495. Neither the opinions nor the quoted ex\xc2\xad\ncerpts suggest that these are the only situations in which Davis-Bacon would apply.\nIn both opinions, the Attorney General explicitly rejected narrow readings of the\nAct in favor of quite expansive ones, and used the \xe2\x80\x9cfederal funds\xe2\x80\x9d concept to argue\nthat a narrower reading would undermine the Act and the public goals it was de\xc2\xad\nsigned to serve. Neither opinion discussed lease-construction or any similar con\xc2\xad\nstruction financing mechanism, nor did either opinion suggest that the Act would\nnot apply if the construction was not built with federal funds but instead was built\nunder federal direction and later paid for with federal funds. A consideration of\nthe context in which these opinions arose will illustrate the point. The 1935 opin\xc2\xad\nion involved construction and demolition of buildings under the D.C. Alley\nDwelling Authority, which was empowered to tear down old buildings and con\xc2\xad\nstruct new ones to redevelop alleys in the District of Columbia. Because the Act\ncontemplated that the new dwellings might later be leased or sold to private parties,\nit was contended that Davis-Bacon should not apply. Attorney General Cummings,\nhowever, determined that the prospect that the buildings would be sold did not\ndetract from the public character o f the construction:\nI approve the broad construction which has thus been placed upon\nthe statute and regard it as supported both by the language of the\nAct and by the apparent purposes intended to be accomplished.\nUnder this view buildings erected with funds supplied by the Con\xc2\xad\ngress for the furtherance of public purposes are not to be distin\xc2\xad\nguished, so as to affect the application of the statute, upon\nconsideration of their character or the particular public purpose\nwhich their building is intended to further; nor do I regard it as\ncontrolling that some of them will be, or may be, conveyed for a\nconsideration to private persons at some time after completion.\n38 Op. Att\xe2\x80\x99y Gen. at 233.\nThe 1988 Opinion\xe2\x80\x99s quote from the 1960 opinion is itself a quote from the leg\xc2\xad\nislative history of the Federal Highway and Highway Revenue Acts of 1956, and\nwas drawn from a section of the history urging that Davis-Bacon wage standards\nshould apply not only to \xe2\x80\x9cdirect Federal construction\xe2\x80\x9d \xe2\x80\x94 highways constructed by\nthe government (without regard to financing mechanisms) \xe2\x80\x94 but also to highways\n120\n\n\x0cReconsideration o f A pplicability o f the D avis-B acon A ct to the\nVeterans A d m in istra tio n \'s Lease o f M edical F acilities\n\nconstructed by state and local governments, with federal financial assistance. 41\nOp. Att\xe2\x80\x99y Gen. at 495; H.R. Rep. No. 84-2022, at 12-13 (1956); 23 U.S.C. \xc2\xa7 113\n(successor Act). While the quoted legislative history indicates that the Congress\nthought that federally-aided nonfederal highway projects were not covered, this\ndistinction is irrelevant to the question at issue here. Neither the 1960 opinion nor\nthe Highway Act nor the quoted legislative history defines \xe2\x80\x9cdirect Federal con\xc2\xad\nstruction\xe2\x80\x9d in such a way as to exclude lease-construction contracts. The only light\nthese sources shed on the question of how lease-construction should be categorized\nis to emphasize that where the government is financially responsible for construc\xc2\xad\ntion costs, the purposes of the Davis-Bacon Act may be implicated. Furthermore,\nthis commentary was meant as background. The question at issue in the 1960\nopinion was whether independent owner-operators of trucks on a Davis-Bacon\nproject were nonetheless employee \xe2\x80\x9cmechanics and laborers,\xe2\x80\x9d subject to the Act\xe2\x80\x99s\nprevailing wage requirement. The Attorney General concluded that they were, in\npart because a \xe2\x80\x9cniggardly construction\xe2\x80\x9d of the term \xe2\x80\x9cmechanics and laborers\xe2\x80\x9d\nwould be inconsistent with the remedial purposes of the Act. 41 Op. Att\xe2\x80\x99y Gen. at\n500.\nIn short, the cited Attorney General opinions interpreted the Davis-Bacon Act\nexpansively to ensure that its beneficial purposes would not be evaded. Conse\xc2\xad\nquently, we do not think that these opinions support the argument that particular\nfinancing mechanisms remove public construction projects, such as those paid for\nby long-term lease, from the Act.\nD.\n\nOne final argument has been put forth to support the conclusion reached by the\n1988 Opinion: that Congress, in other statutes, explicitly indicated that DavisBacon requirements would apply to particular lease contracts; and that these stat\xc2\xad\nutes \xe2\x80\x9cindicate[] not only that Congress knows how to insure that leases are covered\nby the Davis-Bacon Act in those few situations where it so chooses, but also that\nsection 276a(a) by itself does not include leases.\xe2\x80\x9d 1988 Opinion at 95. The pri\xc2\xad\nmary statute relied upon is 39 U.S.C. \xc2\xa7 410(d)(1), which states that\nA lease agreement by the Postal Service for rent of net interior\nspace in excess of 6,500 square feet in any building or facility, or\npart of a building or facility, to be occupied for purposes of the\nPostal Service shall include a provision that all laborers and me\xc2\xad\nchanics employed in the construction, modification, alteration, re\xc2\xad\npair, painting, decoration, or other improvement of the building or\nspace covered by the agreement, or improvement at the site . . . shall\nbe paid [Davis-Bacon wage rates].\n\n121\n\n\x0cO pinions o f th e O ffice o f L e g a l C ounsel\n\nThis statute covers not just the lease-construction of entire buildings, but construc\xc2\xad\ntion involved in short-term use o f relatively small amounts of space in larger\nbuildings, including incidental construction and improvements beyond those cited\nin the Davis-Bacon Act. It would take a more expansive reading of the DavisBacon Act than Labor has urged in this case to match this coverage. In light of\nthis, the House Report cited in the 1988 Opinion almost certainly was correct in\nconcluding that the statute extended Davis-Bacon coverage. H.R. Rep. No. 911104, at 27 (1970). Too, the Act was passed in 1970, before the Comptroller Gen\xc2\xad\neral reversed his 1962 decision that Davis-Bacon did not apply to leases. In view\nof these factors, we do not believe that this statute sheds much light on how Con\xc2\xad\ngress intended Davis-Bacon to apply in other lease-construction settings.\nIII.\n\nThe Department of Labor also suggests that we should defer to its determination\nwhether a particular contract is covered by Davis-Bacon, citing 29 C.F.R. \xc2\xa7\xc2\xa7 5.13\nand 7.1(d) (1994), Reorg. Plan No. 14 of 1950, 3 C.F.R. 1007 (1950), reprinted in\n5 U.S.C. app. at 1261 (1988),11 and a variety of cases. While the authorities cited\nclearly indicate that Labor has authority to set wage rates, they do not indicate\nwhether Labor\xe2\x80\x99s resolution of legal questions relating to coverage disputes super\xc2\xad\ncedes the Attorney General\xe2\x80\x99s authority, under Executive Order No. 12146, 3\nC.F.R. 409 (1979), to resolve legal disputes between executive branch agencies.\nRather, these sources state that the contracting agency has the initial responsibility\nfor determining coverage, see, e.g., Universities Research A ss\xe2\x80\x99n v. Coutu, 450 U.S.\n754, 759 n.6, 760 (1981); North G eorgia Building and Constr. Trades Council v.\nGoldschmidt, 621 F.2d 697, 703 (5th Cir. 1980); and that the Reorg. Plan and La\xc2\xad\nbor Department regulations provide for review by Labor of contracting agencies\xe2\x80\x99\ncoverage determinations. Reorg. Plan No. 14 of 1950; 29 C.F.R. \xc2\xa7\xc2\xa7 5.13 and\n7 .1(d); Coutu, 450 U.S. at 760; North Georgia, 621 F.2d at 704.12\n\n11 R eorg Plan No. 14 provides\nIn o rd er to assu re c o o rd in atio n of ad m in istratio n and co n sistency o f enforcem ent o f ihe labor\nstan d a rd s pro v isio n s o f e ac h o f the fo llo w in g Acts [in clu d ing the D avis-B acon A ci] by the F e d \xc2\xad\neral agencies responsible for the adm inistration thereof, the Secretary o f Labor shall prescribe\nap p ro p ria te stan d ard s, regulations, and procedures, w hich shall be observed by these agencies,\nand cau se lo b e m ade b y the D epartm ent o f Labor such in vestigations, with respect to co m p li\xc2\xad\nance w ith and e n fo rcem en t o f such labor standards, as he d eem s desirable\n5 U .S C app at 1261\n12 W hile Ihe N o rth G eo rg ia case also stales that the W age A ppeals B oard is \xe2\x80\x9cauthorized [by 29 C F.R.\n\xc2\xa7 7 1(d)] to act w ith finality on b eh alf of the S ecretary o f L ab o r\xe2\x80\x9d in review ing determ inauons m ade by agen\xc2\xad\ncies in ap p ly in g the D av is-B aco n A ct, 621 F 2 d at 704, the q u o te d language indicates only that the W A B has\nfinal a u th o rity to act fo r the Secretary of L a b o r and does not indicate w hether, and lo w hai extent, the D e\xc2\xad\np a rtm e n t\xe2\x80\x99s ex ercise o f that au th o rity is rev iew ab le by the A tto rney G eneral or by the courts. 29 C F R\n\xc2\xa7 7 .1 (d ) say s only th a t the B oard \xe2\x80\x9c shall act as fully and finally as m ight the Secretary o f Labor concerning\nsuch m a tte rs.\xe2\x80\x9d\n\n122\n\n\x0cReconsideration o f A pplicability o f the D avis-B acon A ct to the\nVeterans A dm inistration \xe2\x80\x99s Lease o f M edical Facilities\n\nIt is true that Reorganization Plan No. 14 of 1950 seeks coordination of admini\xc2\xad\nstration and consistency of enforcement of, among other statutes, the Davis-Bacon\nAct, and that the Plan places the principal authority for bringing about consistent\nadministration of the statute with the Department of Labor. 5 U.S.C. app. at 1261.\nThat authority, however, must be reconciled with the authority of the Attorney\nGeneral to make final decisions for the executive branch on legal determinations\nunder Executive Order No. 12146, which provides that the Attorney General may\nresolve \xe2\x80\x9clegal disputes\xe2\x80\x9d between executive agencies. See also 28 U.S.C. \xc2\xa7 511\n(\xe2\x80\x9cThe Attorney General shall give [her] advice and opinion on questions of law\nwhen required by the President\xe2\x80\x9d) and 28 U.S.C. \xc2\xa7 512 (\xe2\x80\x9cThe head of an executive\ndepartment may require the opinion of the Attorney General on questions of law\narising in the administration of his department\xe2\x80\x9d). We believe that, read together,\nthe Davis-Bacon Act, the Reorganization Plan, 28 U.S.C. \xc2\xa7\xc2\xa7 511 and 512, and\nExecutive Order No. 12146, while granting the primary responsibility for inter\xc2\xad\npreting Davis-Bacon to Labor, also confer on the Attorney General, at the request\nof appropriate officials, the authority to review the general legal principles under\xc2\xad\nlying certain of the Secretary\xe2\x80\x99s decisions under the Act. Accord Application o f the\nDavis-Bacon Act to Urban Development Projects that Receive Partial Federal\nFunding, 11 Op. O.L.C. 92, 94-95 (1987) (Reorganization Plan 14 \xe2\x80\x9cspeaks only to\n\nthe respective functions of HUD [the contracting agency] and Labor in adminis\xc2\xad\ntering [Davis-Bacon provisions of] the Housing and Community Development\nAct,\xe2\x80\x9d and \xe2\x80\x9cdoes not preclude either the head of a department from seeking, or the\nAttorney General from rendering, an opinion on a question of law arising in the\nadministration of his department\xe2\x80\x9d).13\n\n13\nT h is view is consistent with prior decisions o f the A ttorney G eneral som etim es cited for the pro p o sitio n\nthat Labor has final authority to interpret the D avis-B acon Act. Thus, for exam ple, in F ederal A id H ighw ay\nP rogram \xe2\x80\x94 P revailing Wage D e term in a tio n, 41 O p A tt\xe2\x80\x99y G en. 488 (1960), the A ttorney G eneral agreed\nonly lhat Labor has authority under the R eorganization Plan and the statute to determ ine w hether certain\nem ployees w ere \'la b o re rs or m echanics\xe2\x80\x9d w ithin the m eaning o f the D avis-B acon A ct \xe2\x80\x94 not w hether the\ncontract itse lf was covered. Since this opinion resolved a dispute betw een the D epartm ents o f L abor and\nC om m erce o v er w hich o f those iw o agencies should m ake the determ ination, it did not fully ad d ress the\nquestion o f the extent o f the authority o f the D epartm ent o f Justice to review Labor D epartm ent legal d e te r\xc2\xad\nm inations under the Act\nSim ilarly, in O ffice o f Federal Procurem ent P olicy \xe2\x80\x94 A u th o rity to D eterm ine W hether the S ervice C on\xc2\xad\ntract Act, W al.sh-H ealev Act, o r D avis-B acon A ct A p p lies to C lasses o f F ederal P rocurem ent C o ntracts, 43\nO p. A tt\xe2\x80\x99y G en 150 (1979), w hile the A ttorney G eneral did conclude thai the D epartm ent o f L abor had\nauthority to m ake contract coverage determ inations under the W alsh-H ealey and Service-C ontract A cts that\nare \' \xe2\x80\x98binding on the procurem ent agencies,\xe2\x80\x9d id at 161, and that the O ffice of Federal Procurem ent Policy\ndoes not have statutory authority to m ake coverage d eterm inations under those statutes, id , these statem ents\ndo not underm ine the authority o f the A ttorney G eneral to review legal aspects o f interagency d isputes relat\xc2\xad\ning to coverage decisions made by the D epartm ent o f Labor Furtherm ore, the 1979 A ttorney G eneral o p in \xc2\xad\nion m ade no such express determ ination concerning the S ecretary \xe2\x80\x99s authority to m ake final D avis-B acon\ncoverage decisions, and indeed, no one had contended that D avis-B acon covered the p articular c o n tract at\nissue in that case. S e e id. at 151 W hile the 1979 opinion also stated that L abor has authority to m ake c o v \xc2\xad\nerage determ inations under \xe2\x80\x99\xe2\x80\x98the contract labor standards statu tes,\xe2\x80\x9d including D avis-B acon, id at 153, this\nstatem en t does not address the disputed question: w hether this authority precludes the D epartm ent o f Justice\nfrom review ing such decisions, and n eith er the opinion nor the cases cited in support o f this passage indicate\n\n123\n\n\x0cOpinions o f th e Office o f L egal C ounsel\n\nIV.\nFor these reasons, we conclude that the ruling of the 1988 O.L.C. Opinion that\nthe plain language of the Davis-Bacon Act indicates that it can never apply to a\nlease that calls for construction of a public work was incorrect. We believe that the\ndetermination whether a particular lease-construction contract is a \xe2\x80\x9ccontract. . . for\nconstruction\xe2\x80\x9d of a public building or public work within the meaning of the DavisBacon Act will depend upon the details of the particular agreement.\n\nWALTER DELLINGER\nAssistant Attorney General\nOffice o f Legal Counsel\n\nthat the A tto rn ey G eneral m ay not address leg al q uestions arising from Labor D epartm ent D avis-B acon\ncoverag e d ecisions.\n\n124\n\n\x0c'