The opinion of the court was delivered by: GREEN
Plaintiff, a black female, instituted this action under Title VII of the Civil Rights Act of 1964
as augmented by the Equal Employment Opportunity Act of 1972
alleging that she was the victim of racial discrimination in the course of her employment at the Equal Employment Opportunity Commission ("EEOC" or "Commission").
The cause was tried to the Court. Numerous stipulations were reached, witnesses testified, and substantial documentation was admitted into evidence.
For reasons demonstrated by the findings and conclusions of law noted within this Opinion, the Court concludes that plaintiff has not prevailed on her claim of racial discrimination and that judgment must be entered in favor of the defendant.
At time of trial, Yvette W. Duggar was employed by the EEOC as Field Manager, GS-15. She had brought to this agency in 1969 her prior work activity with Federal City College as Deputy and Acting Comptroller, with the Peace Corps as a budget officer, and her 15 years' experience with the Department of State in various positions in personnel and accounting and as both budget analyst and officer.
As the GS-15/1 Director, Office of Administration, from December 1969 to March 1971, Ms. Duggar was responsible for budget, financial management and procurement matters of the Commission. Initially, the Commission's accounting records were maintained by the General Services Administration (GSA), based upon obligating and expenditure data provided by the Office of Administration. In July, 1970, upon the recommendation of plaintiff and with the concurrence of then EEOC Chairman William Brown, III, the Commission, under the direction of plaintiff, in preparation for Commission assumption of the accounting function, commenced development of accounting principles and standards.
The Commission underwent a reorganization in March 1971 pursuant to which the Office of Administration was redesignated Office of Management. Named Director of that office, plaintiff was promoted to a GS-16 in June 1971. Reporting to the EEOC's Chairman as his principal advisor on all administrative matters, Duggar's responsibilities now included planning and directing administrative functions, which embraced budget preparation and execution, all fiscal accounting and auditing matters, personnel management and utilization, procurement and personal service contracting, supply and office management. The Office of Management, with a staff of 135, encompassed seven Divisions: Financial Services (referred to alternatively, as Financial Management), Management and Organization, Administrative Services, Personnel, Systems and Controls, Audio-Visuals and Library.
By October 1971 the responsibility for control of obligations and expenditures, and the maintenance of reliable accounting records, was no longer shared with the GSA.
Administrative control over appropriations and funds became increasingly important, stimulating EEOC Order No. 445, the stated purpose being to prescribe
. . . a system of administrative control over appropriations or funds of the Equal Employment Opportunity Commission. It is designed to restrict obligations and/or expenditures to amounts made available through apportionment by the Office of Management and Budget and to permit the fixing of responsibility for any violation of the Anti-Deficiency Act, Section 3679 of the Revised Statutes, as amended (31 U.S.C. 665).
Under the umbrella of this order, effective January 12, 1973, the plaintiff was made EEOC's allottee with authority delegated to her as Director of Management, "to sign the Commission's requests for apportionment and reapportionment" and
. . . to incur obligations within a specified amount pursuant to an apportionment or reapportionment of the EEOC appropriation. No obligation may be incurred except pursuant to authority granted by the allottee after ascertaining the availability of funds, and no disbursement of funds may be certified except with respect to an obligation so authorized. Any employee of the Commission who incurs an obligation without having first secured proper authorization from the allottee shall be in violation of these regulations.
Ms. Duggar's responsibilities as allottee were specified:
. . . The Director, Office of Management, shall be held responsible for restricting obligations and disbursements to amounts apportioned by OMB. The Director shall establish procedures for providing controls and maintaining records to indicate the status of the funds available for obligation. The Director shall make a prompt report to the Chairman whenever it appears that a violation of Section 3679 of the Revised Statutes, as amended, may have occurred.
Order No. 445 further provided that the Commission's Chairman fix responsibility for all violations of the Anti-Deficiency Act,
defined as "the obligation or disbursement of funds in excess of amounts allotted," and immediately forward a report of same to the President, through OMB, and to the Congress in accordance with OMB directives.
From entry in 1969 and until December 1973, Duggar's work performance was not challenged. She received only one evaluation -- "excellent" -- from Chairman Brown.
The term of Chairman Brown (black) expired in late 1973 and John H. Powell, Jr. (black) succeeded him as Chairman. In February 1974, Harold Fleming (black) was detailed to the Commission from the then Department of Health, Education and Welfare as a GS-15 in the Office of Program Planning and Evaluation.
Whatever the scope of the exchanges between Fleming and plaintiff, it is clear that plaintiff was aware of Fleming's concern about the Commission's accounting records and the reconciliation of the fiscal year (FY) 1974 books for the year ending June 30, 1974.
In October 1974, Chairman Powell ordered plaintiff, as Director of the Office of Management, to establish a Funds Control Unit within the Division of Financial Services (Management), to be responsible for monitoring the obligation of funds within the dollar ceilings distributed to the various offices. That Unit was to monthly advise the affected offices of their actual obligations vis-a-vis their control figures. Powell instructed plaintiff that "in no case will control figures be exceeded without your approval and that of the Director of the Office of Program Planning and Evaluation."
Fleming, too, wrote plaintiff in October that the absence of any computer printouts since the start of FY 1975 (July 1, 1974) coupled with "our recent experience with the status of obligation reports for FY 1974" prompted concern as to whether "we are getting ourselves into a similar situation in FY 1975." He requested the status of obligation reports for the first quarter of FY 1975, i.e., from July 1 through September 30, 1974, and suggested a way to expedite future reports.
Around this time Commissioner Raymond Telles wrote plaintiff about the problems in financial management and asked that the Chairman have his audit staff investigate the matter.
Buttressed by the sad history of FY 1974, knowledgeable of the extraordinary disarray of vouchers found without order or sequence on floors, on tops of cabinets, and otherwise in and out of boxes, aware of at least some complaints from vendors that EEOC was not timely paying its bills, plaintiff still failed, incomprehensibly, to address her authority and energies to the escalating situation. All she did do was to assure the Commissioners that she had no objection to an audit of the accounting system, stating that
. . . The deficiencies this Office has encountered in producing monthly status reports . . . were anticipated and fully explainable.
While plaintiff could not recall when the last "non-garbage" report concerning status of funding was produced, she agreed that the 1974 reports for August and September, at least, were inaccurate, "perhaps not produced," and that the October 1974 report was so inaccurate it was useless.
On November 7, 1974, plaintiff notified Chairman Powell she would be unable to meet her commitment of two days earlier to supply the computer generated runs for the first quarter of FY 1975, attributing that failure to key-punch errors which necessitated manual correction. The first quarter FY 1975 had ended September 30, 1974.
Ms. Duggar was fully aware that Chairman Powell, emphasizing the necessity for timely, accurate financial reports, had appointed a group to review the agency's financial management. Such operations were to commence on November 13, 1974. She had already known since September that an audit of FY 1974 accounts was underway and had discussed the matter then with Richard Huber, Director of the Internal Audit Staff, Office of the Chairman, who conducted the audit from September to March 31, 1975. Huber's task was made all the more difficult since the Section 1311 review should have been, but was not, completed by the time he commenced his audit.
The statute, 31 U.S.C. § 200, mandated that by June 30 each unliquidated (open) obligation was to have been reviewed to assure its continued validity; failure to do so would result in monies returned to the U.S. Treasury. Nonetheless, prior to 1975, the Section 1311 Report had never been prepared even though plaintiff's specific assignments included preparation and issuance of this report, as an on-going activity of her office.
By November 18, 1974, and in a follow-up on November 27, Chairman Powell had been alerted by Huber in "flash reports" (Def. Exs. P, Q) as to improprieties and that "lack of proper procedures and controls at the Office of Management for processing obligations" resulted in exceeding the appropriation limitation by more than $200,000 in FY 1974. In his initial assessment of the problem, Huber noted further that
This deficiency in procedures is prevalent throughout the Commission. Financial Management Division is well aware of this condition, however, procedures and controls have not been established to preclude any official or employee of the Commission to authorize or create an obligation in excess of the appropriation limitation imposed by law.
Dismayed at the FY 1974 situation, and recognizing plaintiff's ultimate responsibility for all these concerns as the Director of Management and the agency allottee, Huber outlined the problems: The records (obligating documents) were filed in boxes, not file cabinets, at random and nonsequentially. Open and closed obligations were intermingled. Erroneous corrections on the status of allotment reports, distorting the reality, intensified the crisis. The confusion and error made matters virtually impossible for accurate accounting and responsible financial management. A paid bill, for example, would be posted twice as an obligation: once as a closed obligation, once as an open obligation. Accordingly, the status of allotment reports for FY 1974 as a control of funds were "not worth the paper written on" since it was impossible to ascertain the amount of funds obligated and there was no knowledge as to how much could be spent and whether the funds were over or under obligated. The situation was, in Huber's words, "A mess!"
Huber urged that plaintiff's Office of Management establish procedures and controls and determine the actual amount of funds overobligated for FY 1974. He recommended further that the Commission "identify the (employees) responsible for this violation so that appropriate disciplinary action . . . be taken" and to report this information and the fact of violation immediately to the President through the Director of OMB and to the Congress, as required by 31 U.S.C. § 665.
Acting on instructions from Chairman Powell that he was not to reveal any information concerning the audit to anyone other than the Chairman, not even to the Commissioners, Huber disregarded the customary procedures for initial audits. Although there had been a pre-audit meeting with Duggar following notification to her that her office accounts were being audited, plaintiff was precluded comment thereon since she was neither provided a copy of the audit observations/recommendations as they were developed nor a copy of the final draft report. Testifying as plaintiff's witness, Huber nonetheless vividly detailed the chaotic conditions which precipitated his conclusion as to violations of the Anti-Deficiency Act for FY 1974. ...