Legal Document

470 U.S. 632 105 S.Ct. 1555 84 L.Ed.2d 572 William J. BENNETT, Secretary of Education, Petitionerv.NEW JERSEY. No. 83-2064. Argued Jan. 8, 1985. Decided March 19, Syllabus In earlier proceedings in this litigation, Court, reversing the Court Appeals' judgment, held that Federal Government may recover misused funds from States provided assurances federal grants would be spent only on eligible programs under Title I Elementary and Secondary Education Act 1965, which for to support compensatory education disadvantaged children low-income areas. Bell v. New Jersey, 461 773, 103 2187, 76 312 (1983). However, expressly declined address issue whether substantive provisions 1978 Amendments apply retroactively determining if were years. On remand, Jersey argued Amendments, relaxed eligibility requirements local schools receive funds, should applied during years 1970-1972. The Appeals agreed remanded case petitioner determine disputed expenditures conformed standards. Held: standards do not previously made grants. Pp. 638-646. (a) reliance—based language Bradley Richmond School Board, 416 696, 94 2006, 40 476 (1974)—on a presumption statutory amendments pending cases is inappropriate context. Both nature obligations arose program itself suggest changes presumed operate retroactively. Moreover, practical considerations related administration grant imply generally determined by reference law effect when made. Retroactive application deny both auditors recipients fixed, predictable are proper. 638-641. (b) Neither nor legislative history indicates Congress intended general purpose clarify simplify concerning implementation I, specific references statute new prospectively. Nor administrative regulations, since 1976, conclusion regulations inconsistent with I's policies. 641-645. (c) There no inequity here requiring repayment contrary State obtaining role court reviewing determination have been judge findings supported substantial evidence reflect proper legal Where has properly concluded made, independent authority excuse based its view what most equitable outcome. 645-646. 724 F.2d 34, reversed remanded. Michael W. McConnell, Washington, D.C., petitioner. Mary Ann Burgess, Asst. Atty. Gen., Trenton, N.J., respondent. Justice O'CONNOR delivered opinion Court. 1 presented This was before we then programs. We declined, however, retroactive Amendments. Id., at 781, n. 6, 782, 7, S.Ct., 2192, 2193, 7. remand our decision, Third Circuit improperly expended previous Dept. Ed. Hufstedler, 34 granted certiorari, 469 815, 79, 83 27 (1984), now reverse. 2 * Pub.L. 89-10, 79 Stat. 27, as amended, 20 U.S.C. § 241a et seq. (1976 ed.), grants-in-aid areas.1 Based theory poverty low scholastic achievement closely related, allocated school districts their numbers impoverished State's average per-pupil expenditures. H.R.Rep. 95-1137, pp. 4, 8 (1978), U.S.Code Cong. & Admin.News 1978, p. 4971; S.Rep. 95-856, 5 (1978); see §§ 241a, 241c(a)(2) ed.); 146, 89th Cong., 1st Sess., 5-6 (1965), 1446. Within particular districts, turn directed had high concentrations families. 241e(a)(1)(A). Once reached level targeted schools, all those who needed services regardless family income. 4; 45 CFR 116a.21(e) (1977); 116.17(f) (1972). Respecting deeply rooted tradition state control over education, left officials development meet needs educationally children. restrictions use sought assure moneys used "to provide types areas special above beyond normally part district's regular educational program." 4974. 3 goal providing assistance certain while respecting implemented governed distribution funds. Local content programs, appropriate agency approved applications submitted agencies. 241e(a) ed.). After complied law, agencies distributed districts. 241e(a), 241g. received Department upon spend satisfied I.2 supra, U.S., 776, 2189; 241f(a)(1) As noted violation assurances, States. 4 arises respondent must repay $1,031,304 1970-1972 Newark, N.J. 777, 2190. contention Newark District an incorrect allocation or Instead, Secretary's demand rests finding within district. Regulations attendance could either percentage number families residing area least districtwide average. 116.17(d) Alternatively, entire district designated services, but there wide variances among Ibid. A audit completed 1975 incorrectly allowing 13 these requirements. App. 9-51. found 1971-1972 year, ranged 13% 33.5%, district-wide 33.9%. 23-24. Consequently, year disallowed totaling $1,029,630. also 1970-1971 because limitations, $1,674 remains year. Pet. Cert. 36a-37a. June issued final letter demanding 52-58. further review, hearings Appeal Board (Board). proceedings, authorized compel repayment, miscalculated percentages families, qualified project regulations. 35a-58a. rejected each arguments, id., 37a-58a, ordered repayment. review Board's order, thereby became final. 59a. 6 judicial did order 662 208 (1981). Accordingly, arguments challenging Department's misused. 209. decision first time 95-561, 92 2143, 2701 seq., F.2d, 36, 1. 37. hold affect grants, Our holding does correctly 1970-1972, renew contentions regard remand. II 7 cases. Relying (1974), observed "[a] 'apply it renders unless doing so result manifest injustice direction contrary.' " quoting 711, 2016. conclude, reliance such context inappropriate. made.3 explained case, "the pre-1978 version [of I] contemplated misusing incur debt amount misused." 2192. Although provisions, 782-790, 2192-2197, acknowledged like many other "much contract." Pennhurst Hospital Halderman, 451 1, 17, 101 1531, 1540, 67 694 "The chose participate and, condition receiving grant, freely gave abide conditions I." 790, 2197. failed fulfill right retain entitled amounts terms agreement. 791, 2197; 794, 2199 (WHITE, J., concurring). obtain involved here, money existing See 241f(a) 116.31(c) Assuming met 2197, liable improper expenditures; correlative, had, pre-existing recovery. 1294 9 fact Government's any preceded announced here. provision attorney's fees fee request enacted. rested principle United Schooner Peggy, Cranch 103, L.Ed. 49 (1801), holds true even intervening applies 715, 2018. Bradley, limits principle. refused change action where infringe deprive person matured become unconditional." 720, 2020. limitation comports another venerable rule interpretation, i.e., statutes affecting rights liabilities prospective effect. See, e.g., Security Industrial Bank, 459 70, 407, 412, 74 235 (1982); Greene States, 376 149, 160, 615, 621, 11 576 (1964). Cf. 721, 2021 (noting obligations). 10 Practical enforcement grant-in-aid presumptively evaluated scarcely base adopted Amendments.4 Similarly, basis believe propriety judged than ones time. Hospital, 24-25, 1539, 1543-1544. Requiring audits redetermined response every occurs unworkable unfairly make depend fortuitous timing completion process. difficulties associated particularly objectionable, strengthen auditing process clarifying responsibilities specifying procedures followed. 789, 2196; 37, 131; 53, 161. conclude absent clear indication relevant history, governing alter arising III 12 reauthorization depart program's basic philosophy, instead implementation. 2, 8; 95-586, 130. applicable between October September 30, 1983. 2702. 1530, 2380 (provisions shall take "[e]xcept otherwise specifically Act"). House Report similarly stated changed manner distribute children." 21, 4991 (emphasis added). Thus, more rely below "were designed correct frustrated objectives 36-37. observation mischaracterizes prior 1976 1978. 1967, 32 Fed.Reg. 2742, nearly years, restricted having Supra, 636; Office Program Guide 44, ¶ 1.1 (1968) (explaining requirements). requirement deliberately channeled poorest One consequence comparative approach, located might ineligible though wealthier district.5 later attempted mitigate incidental effect, they indicate conflicted policies I. 14 During consideration 1974 Committee inflexible proportions ineligible. 93-805, 17 1974, 4093, 4108 ("[I]t never render 30% concentration ineligible"). requirements, situation.6 Apparently prompted concerns Congress, modified permit qualify exceed 30%. 42 42914, 42917 (1976), codified 116a.20(b)(2) National Institute Funds Allocation: Current Formula 57, 109 (1977). refined alternative lowering 25% guarantee funding reduced preceding 2732(a)(1). 15 evolution doubt reflects reassessment means implement goals Nonetheless, simply place 1967 neediest conformance directive go available sufficient students, required concentrated projects rather diffused 241e(a)(1)(B) 116.17(c) helped spread thinly impair effectiveness projects. 1814, 2d (1966) (suggesting limited highest families); ("[T]itle successful directing aid families"). 16 abandon underlying enacted Legislative Reports spoke approvingly long-standing policy direct "having families." 11; 21. areas, intent give flexibility without watering down targeting features focus limited." standard product compromise Conference. bill, 22, 211, Senate amendment, 20% poor H.R.Conf.Rep. 95-1753, 255 (1978). Conference amendment designation optional, increased 25%, same fair infer unduly compromised adoption standard, background IV urges affirm ground result. question good faith respect expenditures, acknowledge permissible currently effect.7 find Particular appear present exceptions rule, given framework assuring compliance think recognizing province courts. already accommodated recovery Those limit liability five written notice liability, 884 repealed replaced 1234a(g), authorize Secretary, conditions, return up 75% recovered. 1234e(a). Of course, believes equities warrant, relax forgive entirely. 792, Bennett Kentucky 656, 662-663, 1544, 1549, 590. 18 Because yet addressed Jersey's demanded reversed, consistent opinion. 19 It ordered. POWELL took case. 21 STEVENS, whom MARSHALL joins, dissenting. 22 broader President Johnson characterized "war poverty."1 expenditure large sums improve statute, contain definition program. merely "payments subchapter will . (A) deprived ." 241e(a)(1) 23 comes us, public Jersey,2 "in families" meaning clarified subsequent amendments. If total increased; instead, lower admittedly aid.3 dispute about schools—like allotted 60 Newark—was children.4 "misuse" suggestion different school-attendance remedy misuse redistribution needy recapture Government. 24 agrees amended Ante, 1563. agree original today; indeed, seven dispute.5 us assume none 1971-1972.6 govern disposition controversy derived year—which violated—or language, plainly broad enough 1965 well after 25 repudiated strictly enforced. Court's produces inequitable outcome controlling standard,7 am convinced seriously misread Congress. 26 understand impact enforced holding—and submit repudiated—it useful set forth facts one allegedly "misused." $104,842 Newark's South 17th Street School. disallowance 33.5% 1,549 families.8 slightly higher—33.9%—the satisfy criteria regulations.9 Under assistance, exceeded qualify. Thus Street's 33.5 almost States,10 rigid standard. When anomalous consequences regulation came attention Labor expressed "it ineligible."11 Presumably modify higher.12 Regardless explanation regulatory significant interpreted 28 disapproval kind interpretation reflected example, described Subcommittee Elementary, Vocational provides precise analogue case: 29 "In Baltimore City less 30.3% minimum higher maximum incidence counties. relatively affluent counties 5% 25-30% excluded program."13 30 testimony kind, designate (which originally proposed reduction 20%): 31 "[C]urrent OE [45 116a-20(b)(2) ] percent (based free lunch) target area. bill reduces out concern force some very incidences declare school[s] enrollment ineligible, neighboring districts."14 1965. "local (hereinafter referred 'eligible areas')." 2161, adding broaden ensured narrow it. promulgate being today. 33 my normal decision. WHITE litigation two Terms ago: "A 711 [94 2016, 476] (1974). Accord, Gulf Offshore Co. Mobil Oil Corp., 453 473, 486, [101 2870, 2879 16, 69 784] Here, nothing suggests retroactively, injustice." 793-794, 2198-2199, view, holding, results injustice. 35 Ever strong preference discretion governmental units federally funded programs.15 therefore adopt supportive board's subject jurisdiction.16 Finally, note that, just themselves protected overly prescriptive 1981 again identified interest amendatory legislation. Consolidation Improvement eliminate burdensome, unnecessary unproductive paperwork supervision, control," 95 464, indicated effective "if officials, principals, teachers, supporting personnel freed burdens necessary fiscal accountability contribution instructional Ibid.17 36 sum, cannot how reaches accords 37 respectfully dissent. reauthorized Act. subsequently succeeded Chapter 1981, 97-35, 3801 retains assisting live 1980, former responsible administering 2190, For simplicity, distinction significant, refer Commissioner Secretary. ibid. Courts consistently Indiana Bell, 728 938, 941, (CA7 1984); North Carolina Comm'n Indian Affairs Labor, 725 238, 239 (CA4 Woods 1444, 1446 (CA9 West Virginia 667 417, 420 1981). altered times Changes Infra, 643, 6. 201.51(d)(ii) Later enactment superseded own 3805(b), 98-211, 3, 97 1413, 3805(d) (1982 ed., Supp. I). greater illustrated period 1970 August 31, 1973, $28 million 18.4% allocation. 14. outset program, circumstances project. 116.17(b) (1966). responded indications (1965) ("There whole system basically best approach meeting upgrade program"); (1966), 1966, 3844, 3846 ("[W]hen considered upgraded"). 637. liberalized deemed 93-380, 101(a)(5)(D), 88 500, 241e(a)(13) Furthermore, allowed deem actual attendance, residency, 101(a)(5)(B), 241e(a)(1)(A) 93-763, (1974); 16-17 S.Conf.Rep. 93-1026, 144 contends exceeding standards, $249,607. noted, maintained prior-year levels aid. record leaves unclear satisfied, ibid., possibility information longer underscores problems resulting Brief Petitioner 46, (" 'Poverty bar learning, learning offer escape poverty. neither dissipate skills people, them fullness life informed knowledge. And liberate young mind—in land—to reach furthest thought imagination' ") (statement Johnson). parties elementary schools. accepted, ineligibility issue. (CA3 1983); Respondent 15-16, (acknowledging Circuit's $249,607"); 16-17, 13. 3-year 1970, aggregated $156,166,574. total, $28,709,198 suballotted District. receive. wrong ("[T]he funds"); 5; principal method calculating 1971-1972"). "low-income percentage" 27.9% 33.5%. figure excess disqualified elementary-school-attendance 22.9% 20.6% high-school-attendance 13%. determinations three apparently affirmed. 12, supra. attending counted, increased. School, 40.3%. 53a; purposes argument auditors. represented risen 73.91% 1984-1985. 5. 646; cf. Trans World Airlines, Inc. Franklin Mint 466 243, 277, 104 1776, 1795, 80 273 (1984) (STEVENS, dissenting). 23, 25. (1972) provided: secondary estimated district, several cases, regarded area, district." undisputed Nation. offers following description: through covered readily prototypic 1971-72 primary audit, showed 33.9% (J.A. 108). narrative portion clearly demonstrated uniformly ways. Statistics jobless rate 14%; double Economic Development Another 35,000 residents earning $3,000 per less. 1971, Model Cities expanded include city. At submitted, black population 54.2% 11% hispanic background. slum housing nation, crime 10,000 population, density, maternal mortality second birth rate. significance exacerbating inherent statistics 1970-71 turnover nation. Indeed, data mobility rates 80% 113 J.A. 114; 69)." 3-4 (footnote omitted). quoted statement appears paragraph 4108: "As conceived extended, centered (the district). child locally devised. Congress' historical communities should, conflict constitutional prescriptions, formulate policy. strict narrowly define 'target school' 10% 'educationally deprived' school,' whereas school. While objective serve concentrations, ineligible." (1977), stated, pertinent part: "An (b)(1) addition, agency, approve 1977: Hearings H.R. 95th pt. 392 (1978) (testimony Ruth Mancuso, vice president Association Boards Education). stated: "It intention legislation prescribe type Rather matters judgment What acceptable serving rural entirely urban versa. hand, approach." is, important power actions units, see, EEOC Wyoming, 460 226, 244-248, 1054, 1064-1067, 75 (1983) concurring), congressional accord broadest measure respect. York Telephone 440 519, 539-540, 545-546, 99 1328, 1340-1341, 1343-1344, 59 553 (1979) (opinion J.). echoed recent study, "Title administrator compared current 'the people hide mountains until war come kill dead.' L. McDonnell M. McLaughlin, Policy Role (1982).

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