Amicus Curiae Brief — Bennett v. New Jersey

| Office-Supreme Court, U.S.

@ FILED

No. 83-2064 J 76 10m

IN THE —

Supreme Court of the United States

OCTOBER TERM, 1983

T.H. BELL, SECRETARY OF EDUCATION,

- Petitioner,

STATE OF NEW JERSEY

On Petition for a Writ of Certiorari to the

United States Court of Appeals

for the Third Circuit

BRIEF FOR THE LAWYERS’ COMMITTEE

FOR CIVIL RIGHTS UNDER LAW

AS AMICUS CURIAE

IN SUPPORT OF THE PETITION

FRED N. FISHMAN

ROBERT H. Kapp

Co-Chairmen

NORMAN REDLICH

Trustee

WILLIAM L. ROBINSON

BEATRICE ROSENBERG

NORMAN J. CHACHKIN *

RUTH E. GORDON

LAWYERS’ COMMITTEE FOR

CIVIL RIGHTS UNDER LAW

1400 ‘Eye’ Street, N.W.

Suite 400

Washington, D.C. 20005

(202) 371-1212

Attorneys for Amicus Curiae

* Counsel of Record

TABLE OF CONTENTS

Page

INTEREST OF AMICUS CURIAE ...................----------- 1

REASONS WHY THE WRIT SHOULD BE

r ae ae ů ¶ ¶˙²Ü-ͤ¶¶öe 4

D ̃è EE SR ˙rö?—.: ] 14

TABLE OF AUTHORITIES

Cases:

Alexander v. Califano, 432 F. Supp. 1182 (N.D.

e AS SRS 2, 9n

Bell v. New Jersey, —— U.S. ——, 76 L. Ed. 2d

r ᷑è .... Rare 3, 7

Bradley v. School Board of Richmond, 416 U.S.

ge Ell 7n

Heckler v. Community Health Services of Craw-

ford County, Inc., 52 U.S.L.W. 4621 (U.S. May

e a a 7n

Kentucky Department of Education v. Secretary,

717 F.2d 943 (6th Cir. 1983), petition for cert.

filed, 52 U.S.L.W. 3845 (May 3, 198 6n

Kremer v. Chemical Construction a 456

r ̃ . ee 8n

Pennhurst State School & Hospital v. . Halderman,

, / !... 9

United States v. Security Industrial Bank, 459

U.S. 70 (1982) = 7n

Statutes:

Chapter 1 of the Education Consolidation and Im-

provement Act of 1981, Pub. L. No. 97-35,

§§ 552 et seq., 95 Stat. 464-69 (codified at 20

U.S.C. §§ 3801 et seg. (1982)) —....... 2n

Pub. L. No. 97-35, § 552, 95 Stat. 464 (codi-

fied at 20 U.S.C. § 3801 (1982)) 2.0. 2n

Pub. L. No. 97-35, §§ 556 (b) (1), 558 (b), 95

Stat. 466, 468 (codified at 20 U.S.C. 88 3805

(b) (1), 3807(b) (1982) ) 2n

ii

TABLE OF AUTHORITIES—Continued

Education Amendments of 1978, Pub. L. No. 95-

ef | eae ee ee

Pub. L. No. 95-561, § 101 (a), 92 Stat. 2143,

2161-62 (codified at 20 U.S.C. § 2732 (a) (1)

(0 )

Pub. L. No. 95-561, § 1530, 92 Stat. 2143,

2380, reprinted in 1978 U.S. Code Cong. &

Ad. News 2143, 2380

Title I of the Elementary and Secondary Educa-

tion Act of 1965, Pub. L. No. 89-10, 79 Stat. 27,

reprinted in 1965 U.S. Code Cong. & Ad. News

29, as renumbered by Pub. L. No. 89-750, § 116,

80 Stat. 1191, 1198, reprinted in 1966 U.S. Code

Cong. & Ad. News 1392, 1400

Pub. L. No. 89-10, § 2, 79 Stat. 27, 3

printed in 1965 U.S. Code Cong. &

News 29, 33 (current version at 20 U.S.

bo) . ee

Pub. L. No. 89-10, § 205 (a) (1), 79 Stat. 27,

30, reprinted in 1965 U.S. Code Cong. &

Ad. News 29, 33 (codified at 20 U.S.C.

§ 241 (a) (1) (Supp. IV 1968) )

5 U.S.C. App. (1982) (Inspector General Act of

EE

20 U.S.C. § 1234a(g) (1982)

20 U.S.C. § 1234e(a) (2) (1982)

20 U.S.C. § 2711(c) (1982)

20 U.S.C. § 2732 (1982)

20 U.S.C. § 3803 (1982)

20 U.S.C. § 3805 (b) (1) (A) (1982)

20 U.S.C. § 3805 (b) (3) (1982)

20 U.S.C. § 884 (Supp. IV 1974), as added by Pub.

L. No. 93-380, § 106, 88 Stat. 484, 512, reprinted

in 1974 U.S. Code Cong. & Ad. News 541, 576

20 U.S.C. § 241e (a) (1) (A) (1970)

20 U.S.C. § 241c(2) (Supp. IV 1968)

5

5988822

See

iii

TABLE OF AUTHORITIES—Continued

Legislative Materials:

H.R. Rep. No. 805, 93rd Cong., 2d Sess., reprinted

in 1974 U.S. Code Cong. & Ad. News 40993

Dismissing Certain Cases Pending Before the Ed-

ucation Appeal Board: Hearings on H.R. 8145

Before the Subcommittee on Elementary, Sec-

ondary and Vocational Education of the House

Comm. on Educ. & Labor, 96th Cong., 2d Sess.

Page

8n

ENE SSE — 8n, 13n

Oversight Hearing on Amendments to Title I of

ESEA and GEPA: Hearings Before the Sub-

committee on Elementary, Secondary and Voca-

tional Education, House Comm. on Educ. &

Labor, 96th Cong., Ist Sess. (197999

Education Amendments of 1977: Hearings on S.

1753 Before the Subcommittee on Education,

Arts and Humanities of the Senate Comm. on

Human Resources, 95th Cong., Ist Sess. (1977)

Elementary and Secondary Education Amend-

ments of 1973: Hearings on H.R. 16, H.R. 69,

H.R. 5163, and H.R. 5823 Before the General

Subcommittee on Education, House Comm. on

Educ. & Labor, 93rd Cong., Ist Sess. (1973)

r .

12n

12n

IN THE

Supreme Court of the United States

OCTOBER TERM, 1983

No. 83-2064

T.H. BELL, SECRETARY OF EDUCATION,

4 Petitioner,

STATE OF NEW JERSEY

On Petition for a Writ of Certiorari to the

United States Court of Appeals

for the Third Circuit

BRIEF FOR THE LAWYERS’ COMMITTEE

FOR CIVIL RIGHTS UNDER LAW

AS AMICUS CURIAE

IN SUPPORT OF THE PETITION

INTEREST OF AMICUS CURIAE *

The Lawyers’ Committee for Civil Rights Under Law

was organized in 1963 at the request of the President of

the United States to involve private attorneys in the

national effort to assure civil rights for all Americans.

The Committee has, over the past 21 years, enlisted the

services of over a thousand members of the private bar

in addressing the legal problems of minorities and the

poor.

The Lawyers’ Committee has had a long-standing

interest in Title I of the Elementary and Secondary Edu-

* Letters of the parties consenting to the filing of this brief have

been submitted to the Clerk.

2

cation Act of 1965 because of the statutory emphasis

upon meeting the needs of poor and disadvantaged

children.! In the early 1970’s the Committee began to

monitor federal administration of the Title I program, in

order to determine whether states and local school dis-

tricts were using their grants to operate projects which

carried out this basic purpose. These activities greatly

intensified in 1975 with the creation of the Committee’s

Federal Education Project. One of the Project’s major

goals was to stimulate adherence to the categorical re-

strictions of the Title I statute and regulations in order

to increase the effectiveness of local compensatory pro-

grams. The Project has been an informational resource

for parents of Title I participants and Title I staff in

local educational agencies, and it provided legal repre-

sentation to parents of Title I students in litigation and

administrative complaint proceedings, including a major

supplanting decision, Alexander v. Califano, 482 F. Supp.

1182 (N.D. Cal. 1977).?

In 1981 the Title I program was replaced by “Chapter 1” of the

Education Consolidation and Improvement Act of 1981, Pub. L. No.

97-35, §§ 552 et seq., 95 Stat. 464-69 (codified at 20 U.S.C. 88 3801

et seq. (1982)). Chapter 1 retains the Title I focus upon assisting

educationally disadvantaged children residing in high-poverty areas,

see Pub. L. No. 97-35, § 552, 95 Stat. 464 (codified at 20 U.S. C.

§ 3801 (1982) ), as well as the specific targeting and non-supplanting

provisions of the Title I law, see id., §§ 556 (b) (1), 558 (b), 95

Stat. 466, 468 (codified at 20 U.S.C. §§ 3805 (b) (1), 3807 (b)

(1982)). Hence, the rulings below have continuing importance for

the major federal program of aid to elementary and secondary

schools.

2In 1976, pursuant to a contract with the National Institute of

Education, the Lawyers’ Committee established a separately staffed

unit, the Legal Standards Project, to conduct research on the legal

framework of Title I. This project subsequently provided extensive

recommendations for legislative changes, many of which were in-

corporated in the Education Amendments of 1978, Pub. L. No. 95-

561, 92 Stat. 2143. The Congress’ reliance upon the work of the

Legal Standards Project is acknowledged in the legislative history

of the 1978 amendments.

3

Throughout its involvement with Title I, the Lawyers’

Committee has sought to promote vigorous enforcement

of the programmatic and fiscal restrictions embodied in

the federal statute and regulations. Compliance with

these requirements is essential, in our judgment, to ir-

suring the educational effectiveness of compensatory in-

struction funded by the federal government, However,

our experience demonstrates that meaningful compliance

depends, in significant part, upon creating the expecta-

tion that failure to meet the statutory conditions upon

the expenditure of funds will be followed by audit and

recoupment of misspent monies.

Thus, the Committee is concerned that the holding

below, applying later-enacted statutory provisions to de-

feat recoupment of funds which were not expended in

accordance with the terms contained in a previous grant-

in-aid agreement, will have a detrimental impact upon

educational opportunities for poor children by weakening

the incentive for meticulous adherence to statutory and

regulatory requirements. This is particularly the case

here, since funds are not unlimited and accurate target-

ing of programs to serve only eligible schools and at-

tendance areas is central to the functioning of an effec-

tive federal compensatory program. The depth of our

concern over these matters led us to submit a brief

amicus curiae when this matter previously came before

this Court on the issue of the Secretary of Education’s

authority to recover misspent funds. Bell v. New Jersey,

— US. —, 76 L. Ed. 2d 312 (1983). Because the

ruling by the Third Circuit on remand has an equally

devastating potential to impair achievement of basic pro-

gram goals, and because the Courts of Appeals are being

asked with increasing frequency to review final audit

determinations of the Department of Education concern-

ing Title I projects, we submit this brief to underscore

the important educational, as well as legal, reasons why

this Court should again grant review.

4

REASONS WHY THE WRIT SHOULD BE GRANTED

This case involves the right of the federal government

to recover Title I* grant monies made available to the

State of New Jersey, and by the State to the Newark

school district, for the 1970-71 and 1971-72 school years.

New Jersey admits that the funds were expended at

ineligible schools rather than in accordance with statu-

tory and regulatory provisions in force when the grants

were made.* If the misspent funds are recouped, up to

75% of the amount recovered may be returned to the

State for the purpose of supporting additional compensa-

tory programs to assist Newark students who continue

to suffer the effects of educational deprivation and dis-

advantage.®

3 Title I of the Elementary and Secondary Education Act of

1965, Pub. L. No. 89-10, 79 Stat. 27, reprinted in 1965 U.S. Code

Cong. & Ad. News 29, as renumbered by Pub. L. No. 89-750, § 116,

80 Stat. 1191, 1198, reprinted in 1966 U.S. Code Cong. & Ad. News

1392, 1400.

* Pet. App. 45a, 46a (citing Transcript of Oral Argument before

Education Appeals Board, June 21, 1979, at 26). Briefly, the statute

mandated that Title I-funded projects be located to serve “school

attendance areas having high concentrations of children from low-

income families.” 20 U.S.C. § 241e (a) (1) (A) (1970). Regulations

and Program Guides issued by the Department of Health, Educa-

tion and Welfare between 1965 and 1970 defined this term to mean

attendance areas with higher-than-average numbers or percentages

of children from poor families. See generally Joint Appendix at

14-16, Bell v. New Jersey, —— U.S. ——, 76 L. Ed. 2d 312 (1983)

(Final Audit Report, New Jersey). The major portion of the audit

claim involved in this case results from the improper determination

that ten Newark schools met this eligibility standard in the 1971-72

school year.

5In the words of the statute, New Jersey would have to spend

the returned funds “to the extent possible, for the benefit of the

population that was affected by the failure to comply or by the

misexpenditures which resulted in the audit exception.” See 20

U.S.C. § 1234e (a) (2) (1982); Petition for Certiorari, Secretary of

Education v. Kentucky, No. 83-1798, at 15 n.13.

5

The Court of Appeals for the Third Circuit rejected

recoupment of the monies misspent in 1970-71 and 1971-

72 because the challenged expenditures might possibly

have been proper if tested according to a school eligibility

provision which the Congress added to Title I in 1978.“

The Court of Appeals reached this result despite the

Pub. L. No. 95-561, §101(a), 92 Stat. 2143, 2161-62 (codified

at 20 U.S.C. § 2732 (a) (1) (1982)). There are two reasons why the

expenditures in question might not have been lawful even had they

been made after 1978. First, as the court below recognized, use

of the provision added in 1978 was conditioned upon a special

“maintenance of effort” requirement for compensatory programs;

since New Jersey had not sought to rely upon the 1978 law prior

to review in the Court of Appeals, the record previously made in

the administrative proceedings is not adequate to determine whether

this condition had been met (see Pet. App. 5a). Second, the Title I

law and regulations always required that projects be of “sufficient

size, scope and quality” to offer hope of significant achievement

gains for participants. See Pub. L. No. 89-10, § 2, 79 Stat. 27, 30,

reprinted in 1965 U.S. Code Cong. & Ad. News 29, 33 (current

version at 20 U.S.C. § 2734 (d) (1982). This requirement usually

resulted in a school district’s establishing Title I projects at fewer

than all eligible schools, in light of limited Congressional appropri-

ations, which never reached the authorization level contained in the

statute. Because in this case, the federal auditors determined that

the number of eligible schools was itself improperly inflated, they

had no occasion to consider whether Newark’s Title I program dur-

ing the years in question otherwise met the “size, scope and qual-

ity” requirement. Thus, even if the 1978 amendments’ 25%-

eligibility provision could be used in Newark, questions about the

program’s conformity with other statutory and regulatory require-

ments would remain.

Despite this uncertainty, and despite the possibility that the

Secretary may still establish, on the remand ordered below, the

government’s right to recover the funds sought (even under the

Third Circuit’s retroactive reading of the 1978 amendments), this

matter is ripe for review since the decision below firally—and

erroneously—determines that issue of retroactivity. Moreover, the

decision will bind the Department of Education in Title I audit

cases which are now pending and which may in the future arise

from the States within the Third Circuit. Cf. Pet. at 16 ($68 mil-

lion in Title I audit claims pending). These facts underline the

necessity for review by this Court now.

fact that the 1978 law specifically provides that “the

provisions of this Act and the amendments and repeals

made by this Act shall take effect October 1, 1978“;

and despite the complete absence—from the statutory

language and from the legislative history of the 1978

amendments—of any indication that Congress intended

the new eligibility standard to have retrospective effect.

Instead, the court below relied upon general statements

that the 1978 changes were designed to alter restrictive

interpretations of the original statutory language and

upon the principle that remedial legislation should be

applied retroactively.

This view of the federal government’s authority to

recapture improperly spent grant-in-aid funds would ap-

ply not just to education programs but also to a wide

variety of other grant statutes which federal Depart-

ments are obligated to audit and enforce.“ For this

reason alone, the case involves “a public matter of great

national concern” ” which should be reviewed by this

Court."

Furthermore, the approach taken by the Third Circuit

rests upon fundamental legal errors which demand cor-

New Jersey does not contend, and the court below did not hold,

that the 1978 amendments explicitly repealed or retrospectively

amended the previous eligibility standards which the auditors found

to have been violated.

Pub. L. No. 95-561, § 1530, 92 Stat. 2143, 2380, reprinted in

1978 U.S. Code Cong. & Ad. News 2143, 2380.

Cf. 5 U.S.C. App. (1982) (Inspector General Act of 1978).

10 Pet. App. 5a [Court of Appeals’ ruling].

11 Similarly, the Sixth Circuit’s decision in Kentucky Department

of Education v. Secretary, 717 F.2d 943 (1983), petition for cert.

filed, 52 U.S.L.W. 3845 (May 3, 1984), adopts a rule of construction

which will have serious consequences for all grant programs, and

especially for compensatory education efforts under Title I or Chap-

ter 1. See infra note 25. We submit that review should be granted

in both matters and argument in tandem scheduled.

7

rection by this Court. As the government persuasively

demonstrates, the Court of Appeals confused two basic

and well-settled rules of statutory construction that,

absent clear legislative intent to the contrary, govern

retroactivity: (1) substantive legislation applies only

prospectively; ** and (2) remedial or procedural enact-

ments are given retrospective application in suits filed

prior to, but still pending after, their passage unless

substantive rights would thereby be affected or injustice

would result.“ See Pet. at 8-15. Moreover, the ruling

below violates simple principles of contract which apply

to grant-in-aid programs. As this Court recognized only

last Term in its prior decision in this case, New Jersey

“chose to participate in the Title I program and, as a

condition of receiving the grant, freely gave its assur-

ances that it would abide by the conditions of Title I.

. . . [If] the State failed to fulfill those assurances, .. .

it therefore became liable for the funds misused, as the

grant specified . . . funds that it accepted under ad-

mittedly valid conditions with which it failed to comply.”

Bell v. New Jersey, 76 L.Ed 2d at 326-27; see also, id.

at 329 (White, J., concurring) .“

The government’s right to recover funds not expended

in accordance with the specified conditions is thus a con-

tract right, and subsequent legislation is relevant only

insofar as it unambiguously represents a waiver of the

12 F. g., United States v. Security Industrial Bank, 459 U.S. 70,

79 (1982).

18 F. g., Bell v. New Jersey, —— U.S. ——, 76 L. Ed. 2d 312, 318

n.3 (1983); Bradley v. School Board of Richmond, 416 U.S. 696,

711 (1974). Actually, the Court of Appeals discussed only this

second principle, while ignoring the first.

14 See Pet. App. 40a.

15 Cf. Heckler v. Community Health Services of Crawford County,

Inc., 52 U.S.L.W. 4621 (U.S. May 21, 1984).

contractual conditions. For example, enactment of a

bill directing the Secretary of Education not to seek to

recover misexpenditures identified in audits completed

prior to a specified date would have constituted a

waiver.” Similarly, the 5-year “statute of limitations”

on repayment of misexpenditures of Title I funds“ is

such a waiver under the circumstances specified in the

statute. Absert such a waiver, there is no basis for

modifying the contractual understanding between the

parties by virtue of a subsequent enactment applying to

future grants. This amounts to rewriting the contract

to the detriment of the Department of Education and

16 As the government’s petition demonstrates, nothing in the lan-

guage or the legislative history of the 1978 amendments to Title I

indicates Congress’ intent to waive federal rights under the earlier

grant agreements. See Pet. at 9-11. This Court has repeatedly

emphasized that repeals by implication are not favored. E. g.,

Kremer v. Chemical Construction Company, 456 U.S. 461, 468-78

(1982).

17 Such measures were considered by the Congress in 1980 and

1981. A subcommittee of the House of Representatives held hear-

ings on one bill, Dismissing Certain Cases Pending Before the

Education Appeal Board: Hearings on H.R. 8145 Before the Subcom-

mittee on Elementary, Secondary and Vocational Education of the

House Comm. on Educ. & Labor, 96th Cong., 2d Sess. (1980), but it

was never reported out. A floor amendment with the same effect

was defeated in the Senate on a point of order. 127 “ong. Rec.

$5427-30, 5442 (daily ed., May 21, 1981).

18 20 U.S.C. § 884 (Supp. IV 1974), as added by Pub. L. No. 93-

880, § 106, 88 Stat. 484, 512, reprinted in 1974 U.S. Code Cong. &

Ad. News 541, 576, provided that:

No state or local educational agency shall be liable to refund

any payment made to such agency under this Act (including

Title I of this Act) which was subsequently determined to be

unauthorized by law, if such payment was made more than

five years before such agency received final written notice that

such payment was unauthorized.

See also H.R. Rep. No. 805, 98rd Cong., 2d Sess., reprinted in 1974

U.S. Code Cong. & Ad. News 4098, 4160. The currently applicable

version of this provision is codified at 20 U.S.C. § 1234a(g) (1982).

that of the program beneficiaries, who relied on the as-

surances which New Jersey submitted to expend Title I

funds only in accordance with the statutory and regula-

tory criteria.

This Court has held that the States can be deemed

accountable to comply with only those federal funding

conditions which were clearly explicated at the time a

grant was accepted. Pennhurst State School & Hospital

v. Halderman, 451 U.S. 1 (1981). The corollary of this

principle is that, where the terms of the agreement were

clear and the fact of their violation is admitted, as in

this case, the States can and should be held accountable

to make repayments.

Review in this case is particularly warranted because

the substantive requirement at issue—the determination

of school and attendance area eligibility—is of central

importance to the integrity and effectiveness of federal

compensatory education programs,“ which constitute the

largest part of federal aid to elementary and secondary

education. While it would be highly desirable to assist

all children in need of services, limited funding has made

this impossible. Expenditures must be targeted on dis-

crete populations. Hence, the statute provides that ap-

propriations are to be allocated among States and school

districts according to the number of children from low-

income families,“ and that funds are granted only for

programs which contribute to meeting the needs of edu-

cationally deprived children in areas within school dis-

tricts where there are large concentrations of children

from such families.

1 This remains true under Chapter 1, as it was under Title I.

See supra note 1.

2 See 20 U.S.C. f 241c (2) (Supp. IV 1968) [Title I]; 20 U.S.C.

§2711(c) (1982) [same]; 20 U.S.C. § 3803 (1982) [Chapter 1].

2120 U.S.C. § 2732 (1982) [Title I]; 20 U.S.C. § 83805 (b) (1) (A)

(1982) [Chapter 1]. See Alexander v. Califano, 482 F. Supp. 1182,

10

The project area eligibility standards are linked to the

additional requirement, which has been maintained

throughout all versions of the statute since it was first

passed in 1965, that programs must be “of sufficient size,

scope and quality to give reasonable promise of substan-

tial progress toward meeting” “the special educational

needs of educationally deprived children in” project

areas. The purpose of this provision is to avoid dissipa-

tion of federal grants by spreading them among too

many underfunded projects in too many different schools.

Because local school administrators are almost always

under intense pressure to serve as many students as

possible,“ the threshold determination of eligible school

attendance areas facilitates compliance with the “size,

scope and quality” requirement.™ It is, for this reason,

1189 (N.D. Cal. 1977) (referring to “the legislative choice to con-

centrate rather than spread aid among educationally deprived

children”). Once eligible project areas are selected, every child

determined to be educationally deprived, regardless of economic

status, is eligible to receive services. Educational deprivation is

the sole criterion for deciding which children in a project area will

participate in these federal programs.

22 Pub. L. No. 89-10, § 205 (a) (1), 79 Stat. 27, 30, reprinted in

1965 U.S. Code Cong. & Ad. News 29, 33 (codified at 20 U.S.C.

§ 24le(a)(1) (Supp. IV 1968)) [Title II]; see 20 U.S.C. § 3805

(b) (3) (1982) [Chapter 1].

28 See Joint Appendix at 176, Bell v. New Jersey (New Jersey

Department of Education’s Application for Review of Final Audit

Determination) (“LEA had no choice but to assume high concen-

trations of low-income families in all attendance areas and to at-

tempt to spread the benefits of Title I as broadly as possible to

assure that most educationally deprived children would be served“).

24 See id. at 34 (Final Audit Report, New Jersey) (“We do not

question SDE's assertion that during the period covered by our

audit poverty was widespread in the district. This incidence of

poverty therefore necessitated closer attention to the calculation of

low-income percentages to insure use of Title I funds in eligible

low-income attendance areas with the greatest concentrations of

educationally disadvantaged children.“)

11

critical to the operation of successful compensatory

programs.“

New Jersey's approval of the Newark school distriet's

application to provide programs at ten eligible schools

thus was no mere technical violation. Rather, it diluted

the funds, and thereby the programs, available to par-

ticipating students. The audit and recoupment process

allows the federal government to seek to rectify this

error, and the 75%-payback provision, see supra note 5

and accompanying text, provides a mechanism for using

the process to aid the Title I students harmed by the mis-

expenditures. From an educational standpoint, there-

fore, it is a matter of great significance whether the

process will go forward or whether New Jersey will be

permitted to escape any obligation either to repay the

funds or to increase its remedial efforts. Since there is

* Similarly, the “supplanting” violation at issue in Secretary of

Education v. Kentucky, supra note 5, involves another of the most

fundamental aspects of federal compensatory efforts: the provision

of extra resources for the education of participating children, above

and beyond what they would otherwise receive from state and local

sources. In that case, in 1974, fifty school districts in Kentucky

used Title I funds to support entirely separate “readiness” classes

for participating children, who were removed from their regular

first- or second-grade classes. Even though these students were

promoted at the end of the year to the next grade, they did not re-

ceive the benefit of any expenditure of state and local funds for their

education in required subjects such as language arts, mathematics,

etc. The Secretary of Education sustained audit findings that this

arrangement constituted “supplanting” in violation of the require

ment of the law that “Federal funds . . will be so used (i) as to

supplement and, to the extent practical, increase the level of funds

that would, in the absence of such Federal funds, be made available

from non-Federal sources for the education of pupils participating

{in the Federal program].” Although Kentucky argued that it had

not reduced the number of teachers or level of expenditures in

schools which had Title I readiness classes, this merely compounded

the supplanting—since a small number of nonparticipating students

received the increased benefits of that State and local funding,

while Title I students received none.

12

no persuasive indication that Congress intended, by its

subsequent change in the law, to alter that obligation,

the decision below makes not only bad law but also bad

educational policy.

As this Court is well aware, the statutory framework

of federal grant programs rarely remains completely un-

changed; rather, successive Congresses often amend and

re-amend an enactment in the light of experience and

perceptions. Indeed, State and local grantees are among

the most fervent supporters of this “fine tuning.“ For

this reason, if the decision below is permitted to stand,

federal grantees subject to audit exceptions can be ex-

pected to seek repeated statutory changes that would

make their past non-compliance with program require-

ments conform to the law. The incentive to maintain

compliance with statutory and regulatory provisions will

be substantially diminished; federal program benefici-

aries—in this case, educationally disadvantaged children

who most need assistance—will be the losers. Rather

than permit such a result, this Court should review this

26 See, e. g., Oversight Hearing on Amendments to Title I of

ESEA and GEPA: Hearings Before the Subcommittee on Elemen-

tary, Secondary and Vocational Education, House Comm. on Educ.

& Labor, 96th Cong., Ist Sess. 26-32 (1979) (testimony of New

York City Chancellor Macchiarola supporting amendment to drop

matching funds requirement for schoolwide projects) ; Education

Amendments of 1977: Hearings on S. 1753 Before the Subcommittee

on Education, Arts and Humanities of the Senate Comm. on Human

Resources, 95th Cong., Ist Sess. 1554-58 (1977) (statement of

Conrad Ott, Superintendent of Akron public schools, requesting

amendment to permit continuing services to students formerly at-

tending Title I-eligible schools which were closed) ; id. at 1397-99

(statement of Pennsylvania Secretary of Education Caryl M. Kline,

proposing modification of supplanting provision) ; Elementary and

Secondary Education Amendments of 1973: Hearings on H.R. 16,

H.R. 69, H.R. 5168, and H.R. 5823 Before the General Subcommittee

ä ——— SS

419 (1973) (testimony of Chicago Assistant Superintendent James

— —ͤ——— — —̃

13

ease and hold grantees to repayment in the absence of

clear legislative direction to the contrary.

Based upon nearly a decade of experience with the

Title I and Chapter 1 programs, including extensive

interchange with State and local school personnel and

litigation involving Title I claims, the Lawyers’ Commit-

tee is convinced that the audit process does not impose

unjustified burdens upon school officials based upon tech-

nical or complex statutory or regulatory requirements.

In this case, for example, the Newark school system ap-

parently had little difficulty in correctly identifying eligi-

ble schools in the school year following those for which

the auditors noted misexpenditures.” Throughout the

history of Title I, most States and school districts have

not only conformed their programs to the legal require-

ments, but many have also repaid audit exceptions when

mistakes were identified. Thus, the result reached below

is unfair, both to States which have not violated program

restrictions and also to States which made errors, recog-

nized their accountability, and voluntarily paid their

debts. It is also unfair to the interests of Newark’s

Title I children, which will be doubly impaired: once

when funds were diverted from those the program was

intended to help, and again when these funds are not

recovered. The rights of these program beneficiaries

should be vindicated by repayment of the misspent funds,

especially since, under the 75% payback provision, most

of this money can then be directed to those for whom it

was originally intended—educationally deprived children.

27 See Joint Appendix at 26, Bell v. New Jersey (Final Audit

Report, New Jersey).

28 See, e.g., Dismissing Certain Cases Pending Before the Educa-

tion Appeals Board: Hearings on H.R. 8145 Before the Subcommittee

on Elementary, Secondary and Vocational Education of the House

Comm. on Education & Labor, 96th Cong., 2d Sess. 392 (1980)

(Prepared Statement of Hayes Mizell, Chairman, National Advisory

Council on the Education of Disadvantaged Children).

14

CONCLUSION

For the foregoing reasons, amicus urges that the

Petition for Certiorari be granted.”

Respectfully submitted,

FRED N. FISHMAN

ROBERT H. KAP

Co-Chairmen

NORMAN REDLICH

Trustee

WILLIAM L. ROBINSON

BEATRICE ROSENBERG

NORMAN J. CHACHKIN *

RUTH E. GORDON

LAWYERS’ COMMITTEE FOR

CIVIL RIGHTS UNDER LAW

1400 ‘Eye’ Street, N.W.

Suite 400

Washington, D.C. 20005

(202) 371-1212

Attorneys for Amicus Curiae

* Counsel of Record

2° As previously noted, we also urge the Court to grant review in

the similar case of Secretary of Education v. Kentucky because the

ruling in that case, too, both involves a critical element of federal

education programs and also improperly limits the recoupment

authority of the Secretary of Education. See supra notes 11, 25.