Opinion ID: 760829
Heading Depth: 2
Heading Rank: 2

Heading: Loans or Grants

Text: 22 Alexander argues that the Hatch Act fails to adequately define which state employees are covered. The Act provides in pertinent part that: 23 State or local officer or employee means an individual employed by a State or local agency whose principal employment is in connection with an activity which is financed in whole or part by loans or grants made by the United States or a Federal agency.... 24 5 U.S.C. § 1501(4). Alexander claims that the Act fails to define loans or grants and, as a result, he was unsure whether the federal funds that financed Michigan's Medicaid Program came within the definition since they were universally referred to as reimbursements. There can be no question, however, that Alexander was a state employee covered by the Hatch Act because he was principally employed in connection with the Medicaid Program, which is 50 percent financed by grants from a federal agency. 25 In fact, Alexander conceded before the ALJ that the Medicaid Program was funded by federal grants. Alexander testified that he had recently been told by a federal Health Care Financing Administration (HCFA) employee that the first word of the Social Security Act provisions relating to medicaid is grants. See 42 U.S.C., Subchapter XIX--Grants to States for Medical Assistance Programs. Likewise, the federal regulations under 42 C.F.R., Subchapter C, Part 430--Grants to States for Medical Assistance Programs, set forth the following program description in the first section: Title XIX of the Social Security Act, enacted in 1965, authorizes Federal grants to States for medical assistance.... 42 C.F.R. § 430.0 (1998) (emphasis added). Also, not much further into the regulations, a section entitled Grants procedures begins: Once HCFA has approved a State [medicaid] plan, it makes quarterly grant awards to the State to cover the Federal share of expenditures for services, training, and administration. 42 C.F.R. § 430.30(a)(1) (1998) (emphasis added). 26 Alexander seems to argue that he did not have reason to know he was a covered employee, which would be relevant to the question of whether removal was warranted. Alexander testified that he felt uncertain whether he was a covered state employee and decided to take a chance on an unclear situation. While it is true Alexander made an effort to find out if he was covered by the Act, he proceeded to completely disregard the uncontradicted and unequivocal warnings that he was a covered employee prohibited from running for state representative. In fact, no one told Alexander that he was not covered by the Hatch Act. Moreover, Alexander learned from Sorbet the day after he filed his nominating petition that the federal portion of medicaid was paid by quarterly grant awards. Finally, despite his professed familiarity with a large portion of the federal medicaid regulations and his practice of citing to regulations in connection with his work, Alexander did not examine the regulations himself. 6