Court Opinion

ID: 2963223
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Date Created: 2015-09-21 21:07:42.091698+00
Date Added: 2024-06-11T11:42:39.731867
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USCA1 Opinion

	

                            UNITED STATES COURT OF APPEALS                                FOR THE FIRST CIRCUIT                              _________________________          No. 94-1783                              NANCY STRICKLAND, ET AL.,                                Plaintiffs, Appellees,                                          v.                  COMMISSIONER, MAINE DEPARTMENT OF HUMAN SERVICES,                                 Defendant, Appellee,                                          v.                      SECRETARY, U.S. DEPARTMENT OF AGRICULTURE,                          Third-Party Defendant, Appellant.                              _________________________                     APPEAL FROM THE UNITED STATES DISTRICT COURT                              FOR THE DISTRICT OF MAINE                     [Hon. D. Brock Hornby, U.S. District Judge]
                                            ___________________                              _________________________                                        Before                                Selya, Circuit Judge,
                                       _____________                            Bownes, Senior Circuit Judge,
                                    ____________________                              and Stahl, Circuit Judge.
                                         _____________                              _________________________               Jennifer  H.  Zacks,  Attorney,  Civil  Division,  Dept.  of
               ___________________          Justice, with  whom Frank W. Hunger,  Assistant Attorney General,
                              _______________          Mark B. Stern,  Attorney, Civil Division,  Dept. of Justice,  and
          _____________          Jay  P. McCloskey,  United States  Attorney, were  on brief,  for
          _________________          appellant.               Rufus  E. Brown, with whom  Jack Comart, Pat  Ende, and Pine
               _______________             ___________  _________      ____          Tree Legal Assistance were on brief, for appellees.
          _____________________                              _________________________                                  February 16, 1995                              _________________________

                    SELYA, Circuit Judge.  This suit questions the validity
                    SELYA, Circuit Judge.
                           _____________          of a  regulation promulgated by  the Secretary of  Agriculture in          connection with his management of the Food Stamp Act, 7 U.S.C.             2011-2025  (1988) (the Act).   Answering the question requires us          to explore  the  frontiers of  Chevron  deference.   See  Chevron
                                         _______               ___  _______          U.S.A. Inc.  v. Natural Resources Defense Council, Inc., 467 U.S.
          ___________     _______________________________________          837  (1984).   Because  we believe  that  proper respect  for the          Secretary's  interpretation of  the applicable  statute validates          the regulation, we reverse the district court's order barring its          enforcement.                                          I.
                                          I.
                                          __                                      Background
                                      Background
                                      __________                                          A
                                          A
                                          _                                  The Food Stamp Act
                                  The Food Stamp Act
                                  __________________                    The Act harks  back to  1964.  Congress  passed it  "to          safeguard the health and well-being of the Nation's population by          raising  levels of  nutrition  among low-income  households."   7          U.S.C.    2011.   The Act  creates a federally  funded, but state          administered,   program  designed   to  distribute   food  stamps          according to income and family size.  The recipient can use these          stamps  to  purchase  food   at  local  markets.    Participating          retailers  accept  the  stamps as  if  they  were  cash, for  the          government  redeems  them  at  face  value.    The  Secretary  of          Agriculture is charged with overseeing the federal aspects of the          food stamp program.  See id. at   2013.  Agencies selected by the
                               ___ ___          several  states administer the state aspects of the program.  The                                          2

          Department ofHuman Services (DHS) performs thisfunction in Maine.                    Congress  originally  restricted  eligibility for  food          stamps to families of limited means but made no attempt to define          income (leaving that  chore to  the states).   In 1971,  Congress          directed  the   Secretary  to  establish   uniform  standards  of          eligibility.   The Secretary  then  promulgated regulations  that          defined  net income as gross  income less "the  cost of producing          that  income," but excluded  depreciation as a  component of this          deduction.    See  36 Fed.  Reg.  14102,  14107  (July 29,  1971)
                        ___          (enacting former 7 C.F.R.   273.1(c)(1)(b)).                    In  1977,   Congress  retrofitted   the  Act.     In  a          comprehensive,  detailed   revision  of  the   statute,  Congress          specified that,  for purposes of program  eligibility, income was          not to include the  "cost of producing self-employed income."   7          U.S.C.   2014(d)(9).  Although the 1977 amendments did not define          the term "cost," the House Committee on Agriculture reported that          "the  Department would be  expected to revise  its regulations in          this regard to  allow some  form of depreciation  in arriving  at          `net' business income."   H.R. Rep. No. 464, 95  Cong., 1st Sess.          25 (1977),  reprinted in  1977 U.S.C.C.A.N.  1978, 2001-02.   The
                      _________ __          Secretary revisited the topic in 1978 and promulgated regulations          allowing depreciation  as a  cost in  calculating self-employment          income.  See 43 Fed. Reg. 47846, 47912 (Oct. 17, 1978).
                   ___                    In  1980, a  report  produced by  a joint  House-Senate          conference   committee  muddied  the   waters.    The  conference          committee  report accompanied  the Food  Stamp Act  Amendments of                                          3

          1980 (the FSAA), Pub. L. No. 96-249, 94 Stat. 357 (1980),  which,          among  other  things,  decreased  the  aggregate  value  of  non-          excludable assets  that a family  might own while  retaining food          stamp  eligibility.    The  report  memorialized  the  conferees'          "inten[tion] that the Secretary  no longer permit depreciation to          be subtracted  in determining net self-employment  income."  H.R.          Conf. Rep.  No. 957, 96th Cong., 2d Sess. 29 (1980), reprinted in
                                                               _________ __          1980  U.S.C.C.A.N.  1057,  1070.     Despite  this  statement  of          congressional intent,  however, the  FSAA made  no change  in the          text  of the statutory provision that allowed a deduction for the          "cost of producing self-employed income," 7 U.S.C.    2014(d)(9).                    Hard on the heels  of this conference committee report,          the   Secretary   proposed  regulations   aimed   at  eliminating          depreciation from the computation of the cost  of producing self-          employment income.  In the proposal, the Secretary stated:                    The  regulations  implementing  the 1977  Act                    included a provision allowing depreciation as                    a  cost of  doing business  for self-employed                    households  (   273.11(a)(4)(ii)).   This was                    done  in  compliance  with   the  legislative                    history,  H.R. Rep.  No. 95-464,  p.25.   The                    Conference   Report  accompanying   the  1980                    Amendments suggests that the Secretary delete                    depreciation,  H.R.  Rep.  No. 96-957,  p.29.                    Allowing  such  costs  when  determining  net                    self-employment   income    results   in   an                    exemption of amounts not constituting "actual                    costs" to the household; households are, in a                    sense, given  a deduction in  advance for the                    cost of capital goods  which is otherwise not                    allowed.    Appropriate  changes   are  being                    proposed to   273.11(a) to  correspond to the                    Conference Report's suggestion.          46 Fed. Reg. 4642, 4646 (Jan. 16, 1981).  The final regulation, 7          C.F.R.     273.11(a)(4)(ii)  (1994), mimicked  the  proposal  and                                          4

          instructed the  states to  disregard depreciation  in calculating          net self-employment income.                                          B
                                          B
                                          _                                    The Litigation
                                    The Litigation
                                    ______________                    Nancy and  Lyle Strickland reside  in Belgrade,  Maine.          They ran  a successful construction business until 1990, when the          recession forced them  to downsize.   Although  they remained  in          business,  their profits  dwindled.    At  about this  time, they          applied for, and were  granted, food stamp assistance.   On their          1992 federal tax return, they reported a business loss of $4,686,          largely due  to  claimed depreciation  ($24,380) on  construction          equipment.1   In 1993, the DHS informed the Stricklands that they          would no longer receive  food stamps because, based on  their tax          return, they had annual self-employment income, without regard to          depreciation, of  $19,694.  This equalled net income of $1,641.16          per month   more than twice  the food stamp eligibility limit for          a two-person household.   See Stipulated Record at  5 (confirming
                                    ___          that  the eligibility ceiling for the relevant period is $766 per          month);  see generally  7 C.F.R.    273.9 (1994)  (linking income
                   ___ _________          standards to the federal poverty level).                    Disappointed  by  the  finding  of  ineligibility,  the          Stricklands sued  DHS in  Maine's federal  district court.   They          challenged  the  Secretary's  amended   regulation,  7  C.F.R.                                 
          ____________________               1The  Stricklands  say  that   they  could  not  sell  their          construction  equipment because  they  would no  longer have  any          means of producing income.  They acknowledge, however,  that they          owed  more on  some pieces  of equipment  than those  pieces were          likely to bring on the open market.                                          5

          273.11(a)(4)(ii)  (1994), which excluded depreciation on business          equipment  from  the  allowable  "costs  of  doing  business"  in          determining  a  household's  eligibility  for   food  stamps,  as          offensive  to the mandate of 7 U.S.C.    2014(d)(9).  DHS filed a          third-party complaint against the  Secretary of Agriculture.  The          plaintiffs  then obtained  leave  to amend,  and asserted  claims          directly against the Secretary.2   The parties stipulated  to the          relevant facts  and the district court  certified the Stricklands          as representatives  of a  class comprising  all Maine  food stamp          applicants  or  recipients  adversely  affected  by  the  amended          regulation on or after July 1, 1992.                    On  April 8,  1994, the  court granted  the plaintiffs'          motion  for judgment on the stipulated record.  See Strickland v.
                                                          ___ __________          Commissioner, 849 F. Supp. 818  (D. Me. 1994).  The court  framed
          ____________          the decisive legal  issue in  the following way:   "Can  Congress          change the law, simply by directing  that it be so in legislative          history, without amending the pertinent statutory language?"  Id.
                                                                        ___          at  818.   Judge  Hornby answered  this  loaded question  in  the          negative.   He then ruled  that the amended  regulation could not          stand because the Secretary  had promulgated it in response  to a          perceived congressional directive, not embodied in a duly enacted          statute, rather than in  the authentic exercise of administrative          discretion.  See id. at 820.  The Secretary now appeals.
                       ___ ___                              
          ____________________               2From and  after the time  that the  Secretary answered  the          plaintiff's first  amended complaint, he has  pulled the laboring          oar in defending the regulation.                                          6

                                         II.
                                         II.
                                         ___                             Applicable Legal Principles
                             Applicable Legal Principles
                             ___________________________                                          A
                                          A
                                          _                                  Standard of Review
                                  Standard of Review
                                  __________________                    Interpreting  a  statute  or  a  regulation  presents a          purely legal question subject to de novo review.  See McCarthy v.
                                           __ ____          ___ ________          Azure, 22 F.3d 351, 354 (1st Cir. 1994); Liberty Mut. Ins. Co. v.
          _____                                    _____________________          Commercial Union Ins.  Co., 978  F.2d 750, 757  (1st Cir.  1992).
          __________________________          Nevertheless, the  availability of plenary judicial  review "does          not  obviate the  devoir of  persuasion in  a food stamp  case in          which  a  plaintiff challenges  the  validity  of the  regulatory          mosaic."  Massachusetts v. Secretary of Agric., 984 F.2d 514, 521
                    _____________    ___________________          (1st Cir.), cert.  denied, 114  S. Ct. 81  (1993).  An  inquiring
                      _____  ______          court   even a court  empowered to conduct de novo review    must
                                                     __ ____          examine  the  Secretary's  interpretation   of  the  statute,  as          expressed in the  regulation, through a  deferential glass.   See
                                                                        ___          id.
          ___                                          B
                                          B
                                          _                                 The Chevron Doctrine
                                 The Chevron Doctrine
                                 ____________________                    Judicial  review  of  an  agency's  construction  of  a          statute   that   it   administers  involves   two   separate  but          interrelated  questions, only  the second  of which  furnishes an          occasion for deference:                    First,  always,  is   the  question   whether                    Congress  has directly spoken  to the precise                    question at issue.  If the intent of Congress                    is clear, that is the end of the  matter; for                    the court,  as well as the  agency, must give                    effect to the unambiguously  expressed intent                                          7

                    of   Congress.     If,  however,   the  court                    determines   Congress    has   not   directly                    addressed the precise question at  issue, the                    court   does  not   simply  impose   its  own                    construction  on  the  statute, as  would  be                    necessary in the absence of an administrative                    interpretation.   Rather,  if the  statute is                    silent  or  ambiguous  with  respect  to  the                    specific issue, the question for the court is                    whether  the agency's  answer is  based on  a                    permissible construction of the statute.          Chevron, 467 U.S. at 842-43 (footnotes omitted).
          _______                    In  performing the first part of a Chevron analysis, no
                                                       _______          deference is due.   Instead,  courts must look  primarily to  the          plain  meaning of  the  statute,  drawing  its essence  from  the          "particular statutory language at issue,  as well as the language          and design of the statute as a whole."  K  Mart Corp. v. Cartier,
                                                  _____________    ________          Inc.,  486  U.S. 281,  291 (1988);  accord  Dunn v.  Secretary of
          ____                                ______  ____     ____________          Agric., 921 F.2d 365, 366-67 (1st Cir. 1990).  Beyond this point,
          ______          it  remains unclear whether, and  if so, to  what extent, a court          engaged in  the first stage  of a  Chevron inquiry may  use other
                                             _______          tools of statutory construction,  such as legislative history, in          searching  for  Congress'  unambiguously  expressed  intent on  a          particular  issue.   See  Dunn,  921  F.2d  at  367  n.2  (citing
                               ___  ____          conflicting cases but not resolving the point).                    Legislative  history is  subject  to  many  and  varied          criticisms,  and  the  uncertainty  about its  value  in  general          parallels the  uncertainty  about its  value in  relation to  the          Chevron  doctrine.3  Respectable authority  indicates that  it is
          _______                              
          ____________________               3Critics  say,  for  example, that  legislative  history  is          written  by staffers rather than  by Congress itself;  that it is          easily manipulated;  that it  complicates the tasks  of execution                                          8

          appropriate  to employ  all the  "traditional tools  of statutory          construction"  in the first part of the Chevron analysis when the
                                                  _______          statutory  language  itself  is  not  dispositive.    See INS  v.
                                                                ___ ___          Cardoza-Fonseca, 480  U.S.  421, 432-43,  446  (1987)  (examining
          _______________          legislative history to confirm  the validity of an interpretation          suggested by the  statute's language) (dictum);  Massachusetts v.
                                                           _____________          Lyng,  893 F.2d  424, 429  (1st Cir.  1990).   But there  is also
          ____          respectable  support   for  the  proposition  that   the  Chevron
                                                                    _______          analysis,  in  its  initial  phase,  does  not  look  beyond  the          statutory text.   See,  e.g.,  National R.R.  Passenger Corp.  v.
                            ___   ____   ______________________________          Boston & Me.  Corp., 112 S. Ct.  1394, 1401 (1992) (stating  that
          ___________________          deference is due so long as "the agency interpretation is not  in          conflict  with the plain language of the statute"); K Mart Corp.,
                                                              ____________          486  U.S. at 292  ("If the agency  regulation is  not in conflict          with  the plain language of  the statute, a  reviewing court must          give deference to the  agency's interpretation of the statute.");          NLRB v. United  Food &  Commercial Workers Union,  484 U.S.  112,
          ____    ________________________________________          133-34 (1987)  (Scalia,  J., concurring)  (criticizing dictum  in          Cardoza-Fonseca); Stowell v.  Secretary of HHS,  3 F.3d 539,  543
          _______________   _______     ________________          (1st  Cir. 1993)  (approving deference  where "statute  is silent          with respect to a specific question").                              
          ____________________          and obedience; and that it often is shaped by members of Congress          who  cannot achieve  passage of a  desired interpretation  in the          actual  text of an enacted statute.   See Matter of Sinclair, 870
                                                ___ __________________          F.2d 1340, 1342-44 (7th  Cir. 1989); see also Stephen  Breyer, On
                                               ___ ____                  __          the Uses of Legislative  History in Interpreting Statutes,  65 S.
          _________________________________________________________          Cal. L.  Rev. 845, 845-47  (1991) (describing various  attacks on          legislative  history, but defending its use when judges are faced          with unclear statutory language).                                          9

                    We think  that the  difference between these  two views          may, as  a practical matter, be more apparent than real.4  In any          event,  we do  not  find the  legislative  history in  this  case          determinative.  Thus,  we need not precisely define the function,          if  any, of legislative history under Chevron.  Rather, we assume
                                                _______          arguendo, but do not decide, that an inquiring court  may look in
          ________          that direction during the initial stage of a Chevron inquiry.
                                                       _______                    On this  assumption, the question whether  Congress has          spoken on a particular  question involves two smaller steps.   We          look first  to the  statute's language.   If the text,  given its          plain  meaning, answers the  interpretive question,  the language          must  prevail  and further  inquiry is  foreclosed.   If  no such          readily apparent meaning springs from the statute's text, we next          examine the legislative history, albeit skeptically, in search of          an unmistakable expression of  congressional intent.  And if,  at          that stage, the  statute itself,  viewed in  connection with  the          statutory  design  and   the  legislative  history,  reveals   an          unequivocal answer  to  the interpretive  question,  the  court's          inquiry ends.                    Thus,  it  is  only  when a  court  cannot  discern  an          unmistakably clear  expression of  congressional intent that  the          Chevron  inquiry  moves into  its  second  stage.    Until  then,
          _______                              
          ____________________               4Courts that exclude  legislative history  during the  first          stage  of the  Chevron analysis  may well  decide to  consider it
                         _______          during  the  second  stage  in  order to  determine  whether  the          agency's interpretation  is a permissible one.   Thus, compelling          legislative  history probably  will  preclude a  contrary  agency          position under either of the two views of Chevron.
                                                    _______                                          10

          deference is not a  consideration   but from that  point forward,          deference  looms large.    The court  must  examine the  agency's          interpretation  to see  how  it relates  to  the statute.    This          examination involves a  high degree of  respect for the  agency's          role.  The agency need  not write a rule that serves  the statute          in the  best or most  logical manner; it  need only write  a rule          that  flows rationally  from  a permissible  construction of  the          statute.  See, e.g., Cohen v. Brown Univ., 991 F.2d 888, 899 (1st
                    ___  ____  _____    ___________          Cir. 1993) (noting that it is unimportant to the Chevron analysis
                                                           _______          whether the court, if writing on a pristine page, would prescribe          a  different  version of  the regulation).    In other  words, an          agency's  interpretive regulations  must  stand "unless  they are          arbitrary,  capricious, or  manifestly contrary to  the statute."          Chevron, 467 U.S. at 844.
          _______                    To be sure, the Chevron doctrine has a protean quality.
                                    _______          Under it, courts  afford varying degrees  of deference to  agency          interpretations in varying circumstances.  See Stowell, 3 F.3d at
                                                     ___ _______          544; Sierra Club v. Larson,  2 F.3d 462, 468-69 (1st  Cir. 1993).
               ___________    ______          To  cite  an example  that  possesses  particular pertinence  for          present  purposes,  deference  is  "particularly  appropriate  in          complex and highly specialized areas where the regulatory net has          been intricately woven."   Massachusetts Dep't of Educ. v. United
                                     ____________________________    ______          States Dep't of Educ., 837 F.2d 536, 541 (1st Cir. 1988) (quoting
          _____________________          Citizens  Sav.  Bank v.  Bell, 605  F.  Supp. 1033,  1042 (D.R.I.
          ____________________     ____          1985)).   Accordingly, "[m]atters  of accounting, unless  they be          the expression of a whim rather than an exercise of judgment, are                                          11

          for the agency."   Id. (quoting Cheshire Hosp. v.  New Hampshire-
                             ___          ______________     ______________          Vt. Hospitalization  Serv., Inc., 689  F.2d 1112, 1117  (1st Cir.
          ________________________________          1982)); accord American  Tel. &  Tel. Co. v.  United States,  299
                  ______ __________________________     _____________          U.S. 232, 236-37 (1936).                    Ultimately,   of  course,  deference   depends  on  the          persuasiveness  of  the agency's  position.    See, e.g.,  United
                                                         ___  ____   ______          States v.  29 Cartons of *** An Article of  Food, 987 F.2d 33, 38
          ______     _____________________________________          (1st  Cir.  1993).     Furthermore,  an  administrative  agency's          entitlement  to   deference  is   not  limited  to   its  initial          interpretation  of  a statute.    Agencies "must  be  given ample          latitude  to adapt [their] rules  and policies to  the demands of          changing circumstances."   Rust v.  Sullivan, 500  U.S. 173,  187
                                     ____     ________          (1991)   (citations  and   internal  quotation   marks  omitted).          Consequently, an explained modification, even one that represents          a  sharp  departure  from a  longstanding  prior  interpretation,          ordinarily retains whatever deference is due.  See id. at 186-87;
                                                         ___ ___          Stowell, 3 F.3d at 544.
          _______                                          C
                                          C
                                          _                                 Taming the Oxymoron
                                 Taming the Oxymoron
                                 ___________________                    "Subsequent legislative  history"  is, as  others  have          noted,  see, e.g., Continental Can Co.  v. Chicago Truck Drivers,
                  ___  ____  ___________________     _____________________          916 F.2d 1154, 1157 (7th Cir. 1990), an oxymoron.   What is more,          the  hazards inherent  in virtually  all legislative  history are          magnified  when  congressional materials  are  created  after the          fact, and the views of  a subsequent Congress are imputed to  the          earlier  Congress that  enacted a  given  statute.   See Consumer
                                                               ___ ________                                          12

          Prod.  Safety Comm'n  v. GTE  Sylvania, Inc.,  447 U.S.  102, 117
          ____________________     ___________________          (1980);  United  States  v.  Price, 361  U.S.  304,  313  (1960).
                   ______________      _____          Despite these problems, however, such materials occasionally have          been found useful in  decrypting an unclear statute.   See, e.g.,
                                                                 ___  ____          Seatrain Shipbuilding Corp. v.  Shell Oil Co., 444 U.S.  572, 596
          ___________________________     _____________          (1980);  United States  v. Ven-Fuel,  Inc., 758 F.2d  741, 758-59
                   _____________     _______________          (1st Cir. 1985).   We conclude  that the value,  if any, of  such          post-enactment  materials should  be  decided case  by case,  see
                                                                        ___          Liberty Mut. Ins. Co., 978 F.2d  at 755 n.7, but should always be
          _____________________          ingested with a healthy dose of skepticism.                    Finally,   in  evaluating   an  agency's   response  to          subsequent  comments by Congress, we  must keep in  mind not only          the  dubious value  of such  comments, but  also  two overarching          constitutional principles.   First,  Congress cannot dictate  the          interpretation  of a statute by a subsequent expression of one of          its committees (even, as here, a joint conference committee); "it          is the function of  the courts and not  the Legislature . .  . to          say what an  enacted statute  means."  Pierce  v. Underwood,  487
                                                 ______     _________          U.S.  552, 566  (1988).  Second,  and relatedly,  Congress cannot          amend  a statute  merely by  inserting the  proposed change  in a          congressional  report (even  in  a report  of a  joint conference          committee); the  amendment must  meet the  various constitutional          benchmarks, including  bicameral passage  and presentment  to the          President.   See U.S. Const. art  I; see also INS  v. Chadha, 462
                       ___                     ___ ____ ___     ______          U.S. 919, 944-51 (1983).                                         III.
                                         III.
                                         ____                                          13

                                       Analysis
                                       Analysis
                                       ________                                          A
                                          A
                                          _                                      Stage One
                                      Stage One
                                      _________                    Consistent  with the methodology  we have  outlined, we          begin by examining the plain language of 7 U.S.C.   2014(d)(9) to          determine if it speaks definitively to the necessity of including          depreciation as a "cost" of producing self-employment income.  We          think  it does  not.   Like many  words, "cost"  has more  than a          single, unitary  meaning.   While the plaintiffs  proffer opinion          evidence from an economist  and an accountant to the  effect that          certain professional disciplines routinely calculate depreciation          as  a "cost" of  producing income, that  is only half  the story;          common sense argues that the word "cost" may also legitimately be          restricted  to cash  outlays made  in a  given period  to produce          income.  At bottom, then, the word "cost" is a chameleon, capable          of taking on different meanings, and shades of meaning, depending          on  the subject matter  and the circumstances  of each particular          usage.  See  20 C.J.S.  Cost (1940) (stating  flatly that  "[t]he
                  ___             ____          term [cost] is one of equivocal meaning").  And among its varying          constructions, "cost"  assuredly can  mean the  price of,  or the          amount that  must immediately be  expended to purchase,  an item.          See,  e.g.,  Webster's  Third New  International  Dictionary  515
          ___   ____   _______________________________________________          (1986) (defining "cost" in its  primary sense as signifying  "the          amount or equivalent paid  or given or charged  or engaged to  be          paid or  given  for anything  bought or  taken in  barter or  for          service rendered:   CHARGE,  PRICE"); Black's Law  Dictionary 312
                                                _______________________                                          14

          (5th ed. 1979)  (defining "cost" as "Expense; price.   The sum or          equivalent  expended, paid  or charged  for something.");  Funk &
                                                                     ______          Wagnalls  New Standard  Dictionary  of the  English Language  591
          ____________________________________________________________          (1934)  (defining "cost" as "[t]hat  which has to  be given for a          thing  in order to procure it; especially, the price paid; outlay          of any kind; expense").                    In these circumstances, a credible argument can be made          that, as between two plausible meanings, a reader should give the          word  "cost"  its  ordinary  meaning   as  opposed  to  the  more          specialized meaning preferred by  accountants or economists.  See
                                                                        ___          Perrin v. United States, 444 U.S. 37, 42 (1979) (recognizing that
          ______    _____________          undefined words in a statute ordinarily should "be interpreted as          taking  their  ordinary, contemporary,  common  meaning"); United
                                                                     ______          States v. Holmquist,  36 F.3d  154, 159 (1st  Cir. 1994)  (same),
          ______    _________          petition  for cert. filed (U.S. Dec. 27, 1994) (No. 94-7485).  We
          ________  ___ _____ _____          need not go that far, however; it suffices to say  that "cost" in          this context can  naturally be read as excluding  depreciation on          capital goods.                    Since  the  statutory  language  does  not  resolve the          issue, we must consult  other sources for guidance as  to whether          Congress  has spoken  plainly on  the question  sub judice.   The
                                                          ___ ______          Stricklands asseverate  that the  legislative history  of section          2014(d)(9)  adds the requisite  clarity.  We  do not agree.   The          lone reference  to the subject  in the House  report accompanying          the 1977 revamping of the Act, heralded by  the plaintiffs as the          linchpin of  their asseveration,  comprises but one  paragraph in                                          15

          one report of one of the two chambers that passed the law.  While          a solitary reference may  sometimes be enough to clear  the mists          that  obscure a statute's text   the relevant inquiry, after all,          is  qualitative, not  quantitative    the  solitary reference  to          which  appellants  cling is  too slender  a  reed to  be accorded          controlling weight  under the totality of  the circumstances that          obtain here.  See, e.g.,  United States v. Taylor, 752  F.2d 757,
                        ___  ____   _____________    ______          764 (1st Cir. 1985) (noting the hazards of relying on an isolated          fragment  of legislative history   there, a single paragraph in a          21-page committee report), rev'd on other grounds, 477 U.S.  131,
                                     _____ __ _____ _______          152 (1986).                    The  actual statement    that  the Secretary  "would be          expected"  to include "some form of depreciation"   is couched in          vague and precatory terms.   The statement is neither  precise in          its  content nor  directory  in  its  thrust.    In  itself,  the          statement  implies  the existence  of  agency  discretion.   And,          moreover,  whatever force it  may possess is  diluted because the          1977 amendments  employ language that very  closely parallels the          language of  a previous  regulation,  on the  same subject,  that          excluded depreciation.  When  Congress codifies language that has          already  been given meaning in  a regulatory context,  there is a          presumption that the  meaning remains the same.  See Commissioner
                                                           ___ ____________          v. Keystone Consol. Indus., Inc., 113 S. Ct. 2006, 2011-12 (1993)
             _____________________________          (explaining that  Congress is  presumed to  be  aware of  settled          judicial and  administrative  interpretations of  words  when  it          writes   them  into  a  statute);  cf.  Greenwood  Trust  Co.  v.
                                             ___  _____________________                                          16

          Massachusetts,  971 F.2d  818, 827 (1st  Cir. 1992)  (noting that
          _____________          when  Congress borrows  a  word from  a  legal source,  the  word          usually brings along  its prior judicial interpretations),  cert.
                                                                      _____          denied, 113 S. Ct. 974 (1993).
          ______                    We  add  two  related  points.    First, we  think  the          traditional   infirmities   that   attend   legislative   history          generally, see supra note 3 &  accompanying text, are accentuated
                     ___ _____          where, as  here,  its proponents  focus  on a  single,  isolated,          somewhat  tentative  statement  contained in  a  single  document          produced by a single chamber of a bicameral legislature.  Second,          although  we  recognize  the  uncertain  value of  post-enactment          materials, we deem the provocative statements in the  1980 House-          Senate conference report  competent to lend an element of opacity          to already murky waters.                    To sum  up, the legislative history  underlying section          2014(d), though  suggestive, is  simply not definitive  enough to          suck  the  elasticity   from  the  word  "cost"  and   convey  an          "unambiguously expressed intent of  Congress."  Chevron, 467 U.S.
                                                          _______          at 842-43.                                          B
                                          B
                                          _                              The District Court's Slant
                              The District Court's Slant
                              __________________________                    Nor  do we  share the  district court's  view  that the          Secretary's  change  in  position  forfeits  any  entitlement  to          deference  because  it  occurred   as  a  knee-jerk  response  to          jawboning  that   the   Secretary  mistakenly   perceived  as   a          congressional  mandate.    In the  first  place,  we  know of  no                                          17

          sufficient    basis    for    disregarding     the    Secretary's          characterization  of  the  conference  committee's  report, which          accompanied  the 1982 regulations, as a  "suggestion."  Hence, we          credit  this characterization.  By like token, we are obliged, in          the absence of meaningful  impeachment, to accept the Secretary's          stated reason for making the change   that households  were, in a          real sense, being given an unwarranted anticipatory deduction for          the costs of replacing capital goods, and that the practice ought          to be  stopped    at face  value.   This is  exactly the  type of          "reasoned explanation" that, when accompanying an agency's change          of position,  can evoke  the deference  contemplated by  the Rust
                                                                       ____          Court.  When an agency explicates a principled basis for revising          an interstitial rule in a plausible way, judges should not simply          shrug it off.                    We  make one  final  point.   Courts  must not  lightly          assume that the  Executive Branch is  untutored, or that  cabinet          officers  are  dolts.   Here, for  example,  we are  reluctant to          presume  that  the  Secretary  either overlooked  or  misread  an          unbroken  skein of cases, see,  e.g., Bowsher v.  Synar, 478 U.S.
                                    ___   ____  _______     _____          714, 721-27  (1986) (reviewing caselaw and  history of separation          of powers);  Rhode Island v.  Narragansett Indian Tribe,  19 F.3d
                       ____________     _________________________          685, 699 (1st Cir.) (acknowledging that "[i]n our republican form          of government, legislators make laws by writing statutes"), cert.
                                                                      _____          denied, 115 S.  Ct. 298  (1994), and concluded  that he was  duty
          ______          bound to rewrite the rule simply because the conference committee          groused about  it.  We think  it is much more  realistic to infer                                          18

          that the  conference committee's unredacted comments  served as a          wake-up call,  sparking the sort  of reexamination that  the Rust
                                                                       ____          Court  explicitly  sanctioned.    In  our  tripartite  system  of          government,  inter-branch communication  and cooperation  are not          terrible diseases, to be avoided at all costs, but, rather, are a          tested means of improving the health of the body  politic.  Thus,          evidence  that such a rapport exists, without more, does not cast          doubt on the validity of agency action.                                          C
                                          C
                                          _                                      Stage Two
                                      Stage Two
                                      _________                    Once  we  have concluded  both  that  Congress has  not          spoken  authoritatively  on the  precise  question  and that  the          Secretary's change of heart is not outside Chevron's precedential
                                                     _______          orbit, the remaining pieces of the puzzle fall neatly into place.          Fairly read, the amended regulation is reasonable in light of the          Act's  avowed purpose  of supplementing  the purchasing  power of          those unable to  afford nutritionally adequate diets.5   The idea          that excluding depreciation from income more  accurately reflects          the  ability of  a  family to  purchase  food and,  thus,  better                              
          ____________________               5Indeed, the  amended regulation,  which uses "cost"  in its          lay  sense rather than  in the specialized  plutonomic sense, may          better serve the Act's purposes.  In any given accounting period,          depreciation  is likely to have scant  effect on cash flow   even          its proponents  must  admit that  depreciation  is, at  best,  an          approximation (that is,  a guess) that  exists primarily, if  not          exclusively, on paper   and it may bear little if any relation to          an actual  decrease in the value  of a capital asset.   Moreover,          although depreciation may account for money  set aside to replace          a piece of equipment,  there is no guarantee that  such equipment          will  in  fact be  replaced with  similar  equipment or  with any          equipment at all.                                          19

          indicates  the  need  for   food  stamps,  is  hardly  heretical.          Implementing  such an  idea  merely shifts  the  emphasis of  the          relevant measure  from an  accountant's conception of  profit and          loss  to a layperson's conception of cash flow.  Hence, we cannot          conclude  that the  Secretary's  handiwork, as  expressed in  the          amended  regulation,  is  "arbitrary, capricious,  or  manifestly          contrary to the statute."  Chevron, 467 U.S. at 844.
                                     _______                    The Stricklands  themselves are a good  illustration of          why  the   Secretary's  second   thought  makes   perfectly  good          regulatory sense.  In 1992 the Stricklands had revenue in hand of          more than twice the amount designated as the "maximum" income for          a  family of  two receiving  food  stamps.   We believe  that the          Secretary could reasonably  conclude that households  having this          degree  of cash availability  are no more in  need of food stamps          than families with half as much  take-home pay   who are, by dint          of their income, ineligible  for participation in the  food stamp          program.                    To  be  sure,  the  plaintiffs muster  a  cavalcade  of          contentions that point in  the other direction.  They  argue that          excluding depreciation gives  a somewhat arbitrary  preference to          self-employed  food stamp  recipients who  elect to  rent, rather          than  purchase,  business  equipment,  for  rental  payments  are          deductible.     They  also   argue  that  failure   to  recognize          depreciation discourages  food stamp recipients  from undertaking          certain  business  activities  because,  if  an attributed  self-          employment income  overstates the real profit  they receive, they                                          20

          will forfeit food stamp eligibility.  While these may  constitute          valid  arguments against the wisdom (or, more aptly put, the lack          of wisdom) of the amended  regulation, they do no more than  show          that both  the plaintiffs'  and the  Secretary's readings of  the          word "cost"  as it is used in the  statute are imperfect.  By the          same  token,  however,  both readings  are  plausible.    In that          situation, it  is up to the Secretary, not the courts, to balance          the relevant  policy considerations  and formulate a  rule.   The          implementation   of  a   statutory  term   that  can   reasonably          accommodate  two  or more  interpretations  must be  left  to the          agency.                    We hold,  therefore, that the amended  regulation is an          entirely permissible interpretation of the statute, and, as such,          is an entirely permissible exercise of the Secretary's authority.          Accord St. Amour v.  Department of Social Welfare, 605  A.2d 1340
          ______ _________     ____________________________          (Vt.  1992)  (considering  identical   issue  and  upholding  the          exclusion of depreciation under section 2014(d)).                                         IV.
                                         IV.
                                         ___                                      Conclusion
                                      Conclusion
                                      __________                    We need  go no further.6   The Secretary's  decision to          exclude depreciation from the  cost of producing  self-employment          income is not  inconsistent with  the language and  history of  7          U.S.C.   2014(d)(9).   Moreover,  the decision is  grounded in  a                              
          ____________________               6This  case does  not  require us  to  decide whether  self-          employed  food stamp  recipients must  be given  some alternative          deduction,  such  as  a   deduction  for  replacement  costs,  in          recognition  of either  the cost  of  acquiring capital  goods or          their consumption in the course of producing income.                                          21

          reasonable  interpretation of  the  statute.   Since the  amended          regulation must be upheld  under Chevron principles, the district
                                           _______          court's contrary judgment is          Reversed.
          Reversed.
          ________                                          22