STANLEY SPORKIN, UNITED STATES DISTRICT JUDGE.
Plaintiff, National Center on Missing and Exploited Children (NCMEC), seeks to participate in the fall 1988 Combined Federal Campaign (CFC) for the National Capital Area and other unspecified local CFCs. The United States Office for Personnel Management (OPM), which administers CFC, denied NCMEC's application for admission to the National Capital Area Campaign based on a finding that NCMEC failed to satisfy one of the requirements set forth in the relevant CFC regulations. See 5 C.F.R. Sec. 950.203(b)(9) (1988).
NCMEC now brings this action seeking a preliminary injunction that would permit its participation in the 1988 CFC campaign.
Because I find that the rejection of NCMEC's application is inconsistent with, and contrary to, the relevant CFC regulations, a preliminary injunction will be granted.
The CFC is an annual campaign through which charitable organizations solicit contributions from federal employees. Participating organizations are listed in a "Contributor's Brochure" that is circulated throughout the federal government. Federal employees who choose to contribute may designate the charity (or charities) that is to be the recipient of the contribution. Contributions can be made through periodic payroll deductions or in a lump sum.
The eligibility of a charitable organization for participation in CFC is determined on a yearly basis by either of two methods. Administration of both is overseen by OPM. First, a national organization may apply to OPM for inclusion on the national eligibility list. See id. Sec. 950.202. CFC regulations require that an organization seeking national eligibility "must demonstrate that it provides or conducts real services, benefits, assistance, or program activities, in 15 or more states . . . ." Id. Sec. 950.202(a). Organizations determined by OPM to be nationally eligible are automatically included in each of the 534 domestic CFCs and the CFC Overseas campaign.
Second, an organization may apply to any Local Federal Coordinating Committee (LFCC), see id. Sec. 950.104, for listing in the local portion of the CFC brochure. To qualify for local listing, an organization must demonstrate, inter alia, that it maintains a staffed facility that is open to the general public, at least 15 hours a week, in the local campaign community. See id. Sec. 950.204(b)(3).
NCMEC is an IRS-certified charity. Established in 1984, NCMEC acts as a resource, education and training center for federal, state and local government agencies dealing with the problems of missing and exploited children. For example, NCMEC carries on certain programs on behalf of the United States Department of Justice's Office of Juvenile Justice and Delinquency Programs. Affidavit of David L. Shapiro (Shapiro Affidavit), para. 3. Further, NCMEC operates a toll-free national telephone hotline to assist in reuniting missing children with their families.
Since 1984, NCMEC has participated in CFC. Shapiro Affidavit, para. 8. NCMEC intended to participate in the fall 1988 CFC program. Accordingly, NCMEC applied to the National Capital Area LFCC. See Memorandum in Support of Plaintiff's Motion for Preliminary Injunction (Plaintiff's Memorandum), Attachment Tab A, Letter Dated July 8, 1988. NCMEC regarded admission to the National Capital Area LFCC as a first step in seeking admission to other LFCCs as well as the Overseas campaign.
The National Capital Area LFCC denied NCMEC's application on the ground that it failed to satisfy one of the nine "public accountability standards," namely, CFC regulation 950.203(b)(9). See Plaintiff's Memorandum, Attachment Tab B, Letter Dated July 26, 1988 (citing 5 C.F.R. Sec. 950.203(b)(9)). This denial not only prevented NCMEC's participation in the National Capital Area CFC but, in effect, excluded NCMEC from participation in any of the LFCCs and the Overseas campaign. NCMEC sought review by OPM. OPM upheld the denial of the application. See Plaintiff's Memorandum, Attachment Tab E, Letter Dated August 22, 1988.
Specifically, regulation 950.203(b)(9) requires that an organization seeking inclusion in CFC "[submit annually] a statement affirming that . . . it has received . . . at least 20 percent of its total support and revenue from voluntary contributions from the general public." 5 C.F.R. Sec. 950.203(b)(9). OPM based its denial on a determination that NCMEC received less than 20 percent of its support and revenue from contributions from the general public. NCMEC disputes OPM's determination and argues that, in 1987, 24.9 percent of its operating revenues and expenses came from public support.
The basis of this dispute is clear. Almost half of the funds that NCMEC considers to be derived from the public were in fact provided by the National Endowment for the Protection of Children (Endowment).
The Endowment and NCMEC are related organizations. The Endowment was created in 1985 by NCMEC's Board of Directors for the primary purpose of raising and managing funds to support NCMEC's programs. See Shapiro Affidavit, para. 4. Nevertheless, most of NCMEC's public contributions are received directly by NCMEC. NCMEC deposits with the Endowment any excess contributions it might receive. In turn, the Endowment funnels funds back to NCMEC to support its yearly operating expenses. See id. at para. 5. At all times, the money held by the Endowment represents contributions from the public at large. See id. at para. 6.
In 1987, the relevant year in this case, the Endowment provided NCMEC with $ 330,732, i.e. 11.5 percent of NCMEC's 1987 operating budget. NCMEC argues that the $ 330,732 should be counted as "voluntary contributions from the general public." 5 C.F.R. Sec. 950.203(b)(9). In contrast, OPM has refused to include the funding provided by the Endowment as "voluntary contributions from the general public." Id. Thus, whether NCMEC is eligible for participation in CFC hinges on the interpretation to be given to "contributions from the general public." Id.
A party seeking preliminary injunctive relief must establish: (1) a substantial likelihood of success on the merits; (2) that it will suffer irreparable harm if preliminary relief is denied; (3) that the granting of an injunction will not injure other interested parties; and (4) that public interest favors granting injunctive relief. See Population Institute v. McPherson, 254 U.S. App. D.C. 395, 797 F.2d 1062, 1078 (D.C. Cir. 1986); Wisconsin Gas Co. v. F.E.R.C., 244 U.S. App. D.C. 349, 758 F.2d 669, 673-74 (D.C. Cir. 1985); Foundation on Economic Trends v. Heckler, 244 U.S. App. D.C. 122, 756 F.2d 143, 151 (D.C. Cir. 1985).
A. SUCCESS ON THE MERITS
NCMEC's argument, simply put, is that they have complied with the accountability standards set forth in CFC regulation 950.203(b)(9). NCMEC notes that, in pertinent part, 950.203 states:
B) To qualify for inclusion on the list of organizations judged eligible to participate . . . an organization must submit annually to the Director:
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