Opinion ID: 528395
Heading Depth: 3
Heading Rank: 1

Heading: Budget and Accounting Act of 1921, as amended.

Text: 21 The first of the two statutes under which the OMB promulgated the Circular is the Budget and Accounting Act of 1921, as amended, 31 U.S.C. Sec. 101 et seq. (1921 Act). We have found nothing in the 1921 Act or its legislative history indicating that Congress contemplated in-house federal employees or federal employee labor unions as  '[a particular] class [of plaintiff] to be relied upon to challenge agency disregard of the law.'  Clarke, 479 U.S. at 399, 107 S.Ct. at 757 (quoting Block v. Community Nutrition Inst., 467 U.S. 340, 347, 104 S.Ct. 2450, 2454, 81 L.Ed.2d 270 (1984), other citation omitted, brackets in Clarke ). 14 Moreover, we have found sufficient support in the legislative history to conclude that the interests of in-house federal employees are in fact inconsistent with the animating purpose of the 1921 Act and, therefore, they are outside the Act's zone of interest. Cf. id. 22 Generally, in the 1921 Act Congress sought to coordinate budgeting procedures and to increase efficiency in government operations after vast governmental growth during World War I. After the close of the War, the departments and agencies failed to relinquish authority which had enured to them during the War. Congress found departments and agencies duplicating services and decided to centralize the budgeting system under a single office in each of the two political branches. 23 Before enactment of the 1921 Act, each department or agency developed its own budget and submitted it to Congress, through the Secretary of the Treasury. 15 The President was never directly linked to this process. 16 The congressional committee overseeing that department or agency would authorize and appropriate that budget request. The total United States budget was never forecast; thus it was easy for expenditures to exceed revenues because no single office was monitoring total expenditures. Additionally, each department and agency audited itself with no confirmation by outside auditors. 24 The 1921 Act established a two-pronged approach to this budgeting (or lack-of-budgeting) crisis. First, Congress created a Bureau of the Budget, the predecessor to the OMB, within, but quasi-independent of, the Department of the Treasury. The Bureau was to consolidate all independent budgets of departments and agencies of the United States government, eliminate duplication of services, and cut funding where services were no longer needed. The national budget of the Bureau, including an estimate of revenues for the next fiscal year, would then become the President's budget which the President submitted as one document to Congress for revision and approval. 17 25 The second prong of the 1921 Act was the establishment of the General Accounting Office (GAO) to represent the legislative interest in the budgeting process. The GAO was to be directed by a Comptroller General and Assistant Comptroller General effectively replacing the Comptroller of the Treasury. The Treasury Comptroller had been seriously hampered in effectively controlling Executive branch spending since he served at the pleasure of the President. The 1921 Act also transferred all the auditors from the various departments and agencies to GAO so that auditors would not be employed by the department they were auditing. 26 Congress considered these two separate offices, the Bureau and the GAO, one within each political branch, as a functional and valid constitutional check and balance over the expenditure of funds. Representative James W. Good of Iowa, the chief sponsor of the 1921 Act, and Chairman of both the House Committee on the Budget and the House Committee on Appropriations, stated: 27 We provided for [a] system of checks and balances which ought to exist in every well-regulated budget plan. The President originates the budget and he transmits it to Congress. It is up to Congress to determine whether it will accept the estimates, whether it will modify them, reduce them, or enlarge them. Congress must then assume full responsibility for its acts, just as the President assumes responsibility for his when he makes the budget. After the bill has passed, then, under the execution of the law, we provide for that independent establishment in the general accounting office, an office that will be to the appropriations made by Congress what the Supreme Court is to construction of laws that are enacted by Congress.... 28 We create this independent establishment [the GAO], answerable to Congress, an establishment that has clerks and accountants, who will go through every department of the Government. When they find waste and inefficiency, when they find duplication in the service, they will come to the committee of Congress that has jurisdiction of appropriations and report that fact. That fact will also be communicated to the President of the United States. With that system of checks and balances it is believed this great overlapping of activities, this duplication that exists in every department of the Government, will cease, and that the Government of the United States will be placed upon a business basis.... 18 29 Throughout debate, Representative Good referred to the GAO as a semijudicial office, working directly for Congress to ensure that executive budgets and estimates are properly prepared. 19 30 Nothing in the legislative history of the 1921 Act suggests that Congress contemplated the protection of employment of federal employees. Indeed, Representative Good's presentation of the 1921 Act to the 67th Congress suggests a congressional purpose inconsistent with those interests. That is, the Act would require that some federal employees be terminated under the new budgeting process. 31 The director of the [Bureau of the Budget] must perform his work without fear or favor. He must do it with a realization that practically every Senator ... will at some time or another be opposed to what he is doing. He must do it with a realization that at some time or another practically every Member of the House will oppose him.... Many [federal employee] offices must be abolished. Some of the men who are here performing a public service must go home, and they will have to be sent home; and when such an officeholder comes from your [congressional] district you will go down and see the [employee's superior] officer in [sic] behalf of the man from your district whom he is discharging, and Senators will go down, and they will make strong pleas showing how this man or that man who is slated to go has been a faithful public servant and why he should be permitted to remain. 32 When it comes to discharging these men who must be discharged, I say to you it is going to test the backbone in a man who has to do this work; it will try the fiber of the best man that the President can secure.... We ought not to throw upon the Secretary of the Treasury this duty ... [because this]would simply create disturbance with the other members of the Cabinet whose organizations by such act he was attempting to regulate and control. 20 33 While Representative Good made this statement during debate on whether the Bureau of the Budget should be under the Department of the Treasury or directly under the Executive Office of the President, 21 his statements illustrate that Congress was aware that some federal employees would lose their jobs after the 1921 Act took effect. He does not hint of any remedy for the severed employees, or suggest that the employees may assert standing upon an act with which their interests are logically inconsistent. Good's statements support the inference to be drawn from the text of the Act. That is, although Congress was well aware that the reformation of the federal budgeting process would result in a loss of federal jobs, it afforded the discharged employees neither protection nor remedy. Thus, the 1921 Act is fundamentally inconsistent with the interests asserted by appellants, who, quite understandably complain that the challenged governmental conduct will cause an adverse impact to in-house employees. 34 Appellants may have many interests, but for zone of interest purposes we must look to their particular interests, not to the interests amounting to generalized grievances of all citizens. See ASARCO, Inc. v. Kadish, --- U.S. ----, 109 S.Ct. 2037, 104 L.Ed.2d 696 (1989); City of Los Angeles v. Lyons, 461 U.S. 95, 111-12, 103 S.Ct. 1660, 1670, 75 L.Ed.2d 675 (1983). The dissent contends that we proceed from an erroneous fundamental premise that the employees cannot assert an interest in having the government conform to the law in making a contracting out decision. Dissent at 1056. However, as we have previously held, ... to satisfy the zone of interests requirement, appellants must establish that their particular interest alleged to have been injured by the [alleged failure of the government to conform to a law] fall within the respective zones of interests intended to be protected or regulated by [that law]. Haitian Refugee Center v. Gracey, 809 F.2d 794, 812 (D.C.Cir.1987) (emphasis added). 35 As we noted in Haitian Refugee Center, 36 [i]f any person or organization interested in promoting ... protection of the rights created by a statute ... has an interest that falls within the zone protected or regulated by the statute ..., then the zone-of-interest test is not a test because it excludes nothing. Indeed, such a reading would mean that this court ignores the Supreme Court's decisions that persons who have only a generalized grievance about the way in which government operates do not have standing. 37 Id. at 813 (citing Schlesinger v. Reservist Comm. to Stop the War, 418 U.S. 208, 94 S.Ct. 2925, 41 L.Ed.2d 706 (1974); United States v. Richardson, 418 U.S. 166, 94 S.Ct. 2940, 41 L.Ed.2d 678 (1974)). 38 Concededly, in Haitian Refugee Center, we conducted our zone of interest analysis without the benefit of the Clarke decision, but nothing in Clarke changes that analysis as it applied in Haitian Refugee Center or in the present case. Indeed, in our recent post-Clarke zone of interest decision, Hazardous Waste Treatment Council v. EPA, 861 F.2d 277 (D.C.Cir.1988) (per curiam) (HWTC ), we expressly reapproved our prior understanding of the generalized grievance concept as taught in Schlesinger and Haitian Refugee Center. In HWTC, we expressly reiterated that neither individuals with only a 'generalized grievance[ ]'  (citing Schlesinger ) nor an organization formed to advance [a generalized] grievance (citing Haitian Refugee Center ) has a sufficient interest to support standing. HWTC, 861 F.2d at 287. Thus, in HWTC, although we found that a trade association had standing as an organizational representative of the consumer environmental interest of a member company, we rejected standing to assert claims based solely on the status as representative of competitors of entities allegedly advantaged by the Environmental Protection Agency's failure adequately to perform a statutory duty. We did so, analyzing the standing question in light of Clarke, and expressly revivified Haitian Refugee Center stating a rule that gave any such plaintiff standing merely because it happened to be disadvantaged by a particular agency decision would destroy the requirement of prudential standing; any party with constitutional standing could sue. Id. at 283. See also Cargill, Inc. v. Monfort of Colorado, Inc., 479 U.S. 104, 114-17, 107 S.Ct. 484, 491-93, 93 L.Ed.2d 427 (1986) (holding that threatened loss from increased competition did not alone confer standing on a competitor to bring action under the Clayton Act to enjoin a proposed merger). 39 In HWTC, we recognized that the Clarke analysis of the zone of interest test  'denies a right of review if the plaintiff's interests are so marginally related to or inconsistent with purposes implicit in the statute that it cannot reasonably be assumed that Congress intended to permit the suit.'  861 F.2d at 283 (quoting Clarke, 107 S.Ct. at 757.) We thus found that the test now requires less than a showing of congressional intent to benefit but more than a 'marginal[ ] rela[tionship]' to the statutory purposes. Id. (brackets in original). 22 40 In the present case, the legislative history of the Budget and Accounting Act of 1921, as amended, leads us to conclude that Congress did not contemplate in-house federal employees and federal employee labor unions as plaintiffs. Congress carefully crafted a two-pronged checks and balances budgeting process to coordinate the United States budgeting process, eliminate duplication of services, and promote efficiency. Congress knew that some federal employees would be adversely affected and, instead of giving these employees some recourse, intentionally removed the director of the Bureau of the Budget from as much external pressure as possible so that he could make the hard decision to reduce the employee force where necessary. At most, federal employees' interests are marginally related to this centralized annual budgeting process balanced between the Executive and Legislative branches. Cf. Clarke, 479 U.S. at 399, 107 S.Ct. at 757. It is more logical to conclude that federal employees' interests are inconsistent. Id. Appellants alleged particular interest in the instant case is protection of the federal jobs of their members, not governmental efficiency as asserted by them. See infra. 41 If governmental efficiency was appellants' interest, then they would have no greater Article III injury in fact 23 than any taxpayer opposing a government appropriation. See Flast v. Cohen, 392 U.S. 83, 88 S.Ct. 1942, 20 L.Ed.2d 947 (1968) (for a taxpayer to assert standing, the taxpayer must show that the challenged conduct violates a specific constitutional limitation imposed on the taxing and spending clause and does not merely exceed the general delegation of powers to Congress); see also Bowen v. Kendrick, --- U.S. ----, 108 S.Ct. 2562, 2579, 101 L.Ed.2d 520 (1988) (referring to Flast and the narrow exception it created to the general rule against taxpayer standing); Ketler, supra, at 115-16 ([F]ederal employees have no greater legal interest in or standing to assert allegations of government mismanagement [in the contracting out process] than do ordinary taxpayers.); see generally, District of Columbia Common Cause v. District of Columbia, 858 F.2d 1, 3-4 (D.C.Cir.1988). 42