The opinion of the court was delivered by: RICHEY
Plaintiff Merit Systems Protection Board ("Board") has filed suit in this Court against defendant Mary Eastwood, individually and in her official capacity as Acting Special Counsel of the Board. The gravamen of the complaint is that defendant Eastwood has obligated government funds illegally and otherwise acted in derogation of her statutory duties so as to bring the Board and its Chairwoman, Ruth T. Prokop, close to spending government funds without authorization from Congress in violation of the Anti-Deficiency Act, 31 U.S.C. § 665. To remedy this injury, plaintiff seeks a declaratory judgment that the Board has general administrative and exclusive budgetary authority over the Special Counsel as well as preliminary and permanent injunctions commanding Acting Special Counsel Eastwood to abide by the Board's administrative and budgetary directives.
Now before the Court is defendant Eastwood's motion to dismiss the complaint pursuant to Rule 12(b)(1) and (6) of the Federal Rules of Civil Procedure. In essence, defendant argues that the matter presented is non-justiciable because there is no "case or controversy" and because the issue is by nature a political question best resolved by another branch of the federal government. The Court agrees that this action should be dismissed for the former reason.
The Merit Systems Protection Board and its Special Counsel were established in 1978 by Reorganization Plan No. 2, 3 C.F.R. § 323 (1978 Compilation), reprinted in 5 U.S.C. app. at 57 (Supp.1980), which abolished the former Civil Service Commission. The Reorganization Plan and the subsequently enacted Civil Service Reform Act of 1978, 5 U.S.C. § 1101 et seq., conferred upon the Board the adjudicatory function previously performed by the Civil Service Commission in connection with employee appeals from adverse agency actions and certain new adjudicatory tasks. 5 U.S.C. § 1205. The Board is composed of three Presidentially-appointed members one of whom is selected by the President to serve as "chief executive and administrative officer of the Board." 5 U.S.C. §§ 1201, 1203(a). In order to guarantee the autonomy of the Board from the Executive branch, the Reform Act authorized the Board to submit its annual budget and any legislative recommendations simultaneously to Congress and the President. 5 U.S.C. §§ 1205(j), (k).
The Office of the Special Counsel, on the other hand, was empowered to receive and investigate allegations of prohibited personnel practices and then to seek stays or corrective actions or to prosecute employee disciplinary actions in proceedings before the Board. 5 U.S.C. §§ 1206-08. The independence of this Office was ensured by granting it the authority to appoint the personnel necessary to perform its functions, the power to prescribe regulations relating to the receipt and investigation of matters under the jurisdiction of the Office, and the obligation to report annually to the Congress on its activities and any legislative proposals it might have. 5 U.S.C. § 1206(j), (m). Although the Act does not address the question of the Special Counsel's budgetary authority, the Board has customarily listed the Special Counsel's budget requests as a separate line item appropriation within its budget submission.
On July 8, 1980, the Supplemental Appropriations and Rescission Act, Pub.L.No.96-304, 94 Stat. 857 (1980), suddenly withdrew $ 2 million from the Special Counsel's $ 4.516 million appropriation for FY 1980. The report of the Senate Appropriations Committee which accompanied the bill expressly directed the Acting Special Counsel to "fully respect and abide" by the President's hiring freeze. When defendant Eastwood received this report on July 14, 1980, she immediately ceased all new hiring, and the only employee to enter on duty subsequently had been given a firm commitment by the Office before that date.
Meanwhile, Chairwoman Prokop ordered the Board's budget officer to determine the status of the Special Counsel's budget. Upon receiving a report that a significant over-obligation of funds by the Acting Special Counsel was imminent, the Chairwoman directed defendant Eastwood to cease any further expenditure of funds and advised her that the Chairwoman was responsible for any violation of the Anti-Deficiency Act caused by Eastwood's spending. Ms. Prokop formally communicated the possible deficiency to Congress on August 21, 1980.
On the same day, the Chairwoman wrote to defendant Eastwood in an effort to clarify the relationship between the Board and the Special Counsel. Specifically, Ms. Prokop informed the Acting Special Counsel that the Board would (1) be responsible for processing all hiring and other personnel actions in the Office of the Special Counsel except for selection of employees for that Office; (2) supervise the preparation and presentation of Special Counsel budget proposals; (3) regularly prepare and review Special Counsel accounts; (4) supervise contractual and other financial obligations incurred by the Special Counsel; (5) combine and supervise the public information, Congressional liaison, and interagency liaison activities of the Special Counsel and other Board offices; and (6) provide administrative supervision and services for the Special Counsel's headquarters and field offices. The Acting Special Counsel responded that she refused to comply with the Chairwoman's directives. When Ms. Prokop wrote a second letter demanding immediate implementation of the guidelines set forth in the August 21, 1980, letter, defendant Eastwood again objected and asserted that the Office of the Special Counsel was "independent of any supervision or control of, or direction by, the Board."
Despite the fears of the Chairwoman, there was no violation of the Anti-Deficiency Act. Ms. Prokop, however, remained concerned about her potential liability under that Act when the President signed a continuing resolution on October 1, 1980, which maintained the level of appropriations at the same reduced level as the preceding resolution. Supplemental Appropriations and Rescission Act, Pub.L.No.96-369, 94 Stat. 1351 (1980). The Board consequently filed this suit on November 21, 1980.
When the October 1, 1980, continuing resolution expired on December 15, 1980, it was succeeded by another resolution providing funding for the Office of the Special Counsel at the level of $ 4.2 million for FY 1981. Act of December 16, 1980, Pub.L.No.96-536, 94 Stat. 3166. The danger of an Anti-Deficiency Act violation was thereby obviated, and, as of the date of this Order, neither the Board nor the Special Counsel has been found in violation of the Act. Furthermore, on June 2, 1981, the Senate confirmed the nomination of Alex Kozinski as Special Counsel of the Board; thus, Ms. Eastwood no longer exercises the authority of the Acting Special Counsel.