September 25, 1990
MARION BARRY, JR., ET AL., APPELLANTS
NATE BUSH, ET AL., APPELLEES. PARENTS UNITED FOR THE DISTRICT OF COLUMBIA SCHOOLS, GLENDA PARTEE AND LORRAINE WILSON, INTERVENORS-APPELLEES
Appeals from the Superior Court of the District of Columbia; Hon. Richard S. Salzman, Trial Judge
Ferren, Steadman, and Schwelb, Associate Judges.
The opinion of the court was delivered by: Ferren
This case presents the question whether the Mayor has the authority unilaterally to reduce the Board of Education's 1990 fiscal year appropriation. We hold that he does not.
I. The Facts and Proceedings
The facts of this case are not in dispute. The District of Columbia is running out of money before the end of its 1990 fiscal year. In an attempt to prevent an even more severe revenue shortfall, the Mayor took several actions. Initially, he and the Council forwarded to Congress, on April 13, 1990, a supplemental budget request act asking for a reduction of the amount which the District was authorized to spend. *fn1 Congress approved. See (supra) note 1. That reduction included approximately 1% of the previously approved Board of Education's budget. *fn2 The reduction did not eliminate the accumulating short-fall. *fn3 On June 26, 1990, the Mayor attempted to cut more funds from the District's budget by proposing the "Fiscal Year 1990 Second Supplemental Budget and Rescissions of Authority Request Act of 1990," Bill 8-623. The Council defeated the Mayor's proposal, *fn4 and the bill was not sent to Congress.
As a final effort to prevent the District from exceeding its budget, the Mayor issued Order 90-103 *fn5 on July 19, 1990, mandating an overall reduction of an average of 2% from all District departments and agencies except the Metropolitan Police Department. *fn6 This Order is the subject of the current dispute. It commands the Board of Education to cut $10,861,000 from the supplemental appropriation for fiscal year 1990, see (supra) note 2, leaving a total Board budget of $486,285,000. *fn7
On July 26, 1990, the members of the Board filed a complaint against the Mayor and the District of Columbia and moved for a temporary restraining order and a preliminary injunction to prevent implementation of the $10,861,000 cut. The next day, Judge Shuker granted the requested temporary restraining order, ruling that the
Mayor lacked authority unilaterally to reduce the Board's budget and, further, that the Mayor's actions violated a prior, court-approved settlement agreement.
On August 1, 1990, the Corporation Counsel, acting on behalf of the Mayor and the District (hereinafter collectively called the District) filed a motion for a temporary restraining order in an effort to prevent the Board from obligating the disputed amount before the preliminary injunction hearing. The next day Judge Shuker denied the District's motion, noting that the Mayor, not the Board, was attempting to alter the status quo. On the same day, the District filed an emergency motion in this court requesting a stay of Judge Shuker's order of July 27, 1990. Before we ruled on the emergency motion, Judge Salzman held a hearing, on August 6, 1990, to consider the Board's motion for preliminary injunction. He combined that hearing with a hearing on the District's emergency motion and a trial on the merits. At that hearing, an organization known as Parents United for the District of Columbia Schools was allowed to intervene. *fn8 On August 10, 1990, the District filed with Judge Salzman another motion, requesting reconsideration of Judge Shuker's denial of the District's motion for a temporary restraining order.
Later that day, Judge Salzman issued his decision in favor of the Board, ruling that the Mayor's actions were "null and void." Judge Salzman based his decision on two grounds: (1) the Mayor lacked power unilaterally to reduce the Board's budget, and (2) in applying Order 90-103 to the Board, the Mayor violated the Settlement Stipulation signed five years after the trial court's decision in Evans v. Washington, 106 Daily Wash. L. Rptr. 1929 (D.C. Super. Ct. Sept. 7, 1978) (Belson, J.). *fn9
On August 16, 1990, Judge Salzman entered a permanent injunction ordering the Mayor not to reduce the Board's budget. That same day the District filed a docketing statement and two procedural motions, and, on August 17, 1990, the District filed the instant appeal. On August 27, 1990, a motions division of this court granted the District's request for a stay of Judge Salzman's order pending resolution of the District's appeal.
II. The Post-Evans Settlement Stipulation
We begin by noting that both the Board and the District agree that Order 90-103, as applied to the Board, clearly and unequivocally violates the unambiguous terms of the post-Evans Settlement Stipulation:
Defendants [the District] hereby stipulate that neither the Mayor nor his subordinates will unilaterally reduce -- whether by apportionment, reapportionment, allocation, encumbrance, prohibition, freezing, or change in accounting, budget, procurement, or financial procedures -- the authorized spending level or preclude the expenditure of monies duly appropriated by Congress to the Board of Education and to the District of Columbia Public Schools in any given fiscal year; provided, however, that the Board of Education recognizes the authority of the Mayor to submit a supplemental or deficiency budget, pursuant to Section 442(c) of the District of Columbia Self-Government and Government Reorganization Act (P.L. 93-168), to the Council of the District of Columbia and, upon the latter's approval, to the Congress of the United States, to authorize a rescission of budget authority theretofore granted to the D.C. Public Schools. *fn10
Judge Mitchell signed the Stipulation and explicitly retained "continuing jurisdiction to enforce, if necessary, the terms of this Settlement Stipulation." As Judge Salzman properly held, the Mayor violated the express terms of a judicially supervised settlement agreement that was the result of "full and complete litigation." *fn11 Thus, the Mayor's only proper course in this matter was to return to Superior Court, before implementation of Order 90-103, to seek judicial permission to modify the decree in light of the legal position the Mayor now advances in defending his unilateral action. See Local No. 93, Int'l. Assoc. of Firefighters v. Cleveland, 478 U.S. 501, 515-24, 106 S. Ct. 3063, 92 L. Ed. 2d 405 (1986); Berger v. Heckler, 771 F.2d 1556, 1568 (2d Cir. 1985); see also D.D. v. M.T., 550 A.2d 37, 44 (D.C. 1988) (party that fails to seek modification of court's mandate acts at his or her own peril).
The District argues that statutory changes (see (infra) Part III.) which occurred after the Mayor signed the post-Evans Settlement Stipulation have made the Mayor's continued adherence to that Stipulation a violation of his statutory duty to balance the District's budget. *fn12 Even if the District were correct -- that subsequent statutory changes have affected the legality of the Stipulation -- we have found no precedent for the District's proposition that parties to a court-endorsed settlement agreement are entitled, if they perceive a relevant change in the law, simply to ignore their signed commitments. *fn13 In fact, at least one case the District cites suggests that, with a subsequent change in the law or the facts, courts will modify such decrees if it is equitable to do so. See, e.g., New York State Ass'n for Retarded Children, Inc. v. Carey, 706 F.2d 956, 970 (2d Cir.), cert. denied, 464 U.S. 915, 104 S. Ct. 277, 78 L. Ed. 2d 257 (1983). The decisions which the District cites, see id. and (supra) note 13, should have convinced the Mayor to return to the trial court before applying Order 90-103 to the School Board.
The District's position -- that it can rely on subsequent changes in the law as the basis for ignoring a settlement agreement -- is untenable because it would allow a party arbitrarily to opt out of an agreement with any perceived statutory change and thus would weaken the incentive to settle disputes. See Berger, 771 F.2d at 1568 ("A defendant who has obtained the benefits of a consent decree -- not the least of which is the termination of litigation -- cannot then be permitted to ignore such affirmative obligations as were imposed by the decree.")
In this case, however, the District's failure to seek judicial modification of the Settlement Stipulation did not go unnoticed -- the Board sued -- and judge Salzman ruled on the merits of the District's legal position. For us to remand the case to reopen the settlement, therefore, before ruling on the merits of the applicable statutes, would be a waste of precious time *fn14 and judicial resources at this point. In the event we were to agree with the Board's position on the merits, the terms of the settlement -- as applied to this case -- would remain in effect as a matter of law, not merely as a matter of stipulation; no further trial court consideration would be required. Only if we were to conclude that the Mayor does have the claimed unilateral authority to reduce the Board's budget would there be a role for the trial court to consider whether equitable considerations, in light of the Settlement Stipulation, might constrain the Mayor's use of that authority in this case. *fn15 We therefore turn to the merits.
III. Mayor's Authority to Cut the Board of Education's Budget
The District asserts that the Mayor's use of Order 90-103 unilaterally to reduce the Board's budget was justified on several statutory grounds. Specifically, the District urges that  §§ 442 (a)(1), 448, 449 (b), 603 (c) and (d) of the Self-Government (or Home Rule) Act, D.C. Code §§ 47-301, -310, -312 (2), -313 (c) and (d) (1990), *fn16  applicable provisions of the federal Anti-Deficiency Act, 31 U.S.C. §§ 1341 et seq. (1988), *fn17 and  the D.C. Appropriations Act, 1990, Pub. L. 101-168, 103 Stat. 1267, 1272, 1275 (1989), *fn18 impose a duty on the Mayor to ensure that the District remains financially sound during the fiscal year.
These statutory provisions do impose on the Mayor responsibility, as comptroller, for administering the District's budget during the fiscal year. Moreover, we have held that some of these provisions, coupled with others including a statute not relevant here, D.C. Code § 37-106 (1990), authorized the Mayor unilaterally to reduce the Public Library's appropriation. Hazel v. Barry, 580 A.2d 110, slip op. at 7-9 (D.C. 1990). But as Hazel itself recognizes, see slip op. at 10 n.11, these statutes do not necessarily confer authority on the Mayor to reduce the Board of Education's appropriations. As the Board and amicus point out -- and as the trial court ruled -- another statutory provision found in the Sef-Government Act, § 452, D.C. Code § 31-104 (1988), limits the Mayor's power over the Board's appropriations to acting jointly with the Council.
Section 31-104, in relevant part, states:
With respect to the annual budget for the Board of Education in the District of Columbia, the Mayor and the Council may establish the maximum amount of funds which will be allocated to the Board, but may not specify the purposes for which such funds may be expended or the amounts of such funds which may be expended for the various programs under the jurisdiction of the Board of Education.
Id. (emphasis added). The Board argues that this statutory limitation "reflects the historical position of the Board as an elected body," and that allowing the Mayor the power to reduce -- unilaterally -- the Board's appropriations would intrude on the Board's established autonomy by violating express statutory limits. We agree.
Specifically, § 31-104 provides that the "Mayor and the Council may establish the maximum amount of funds which will be allocated to the Board." Id. The language is unambiguous: establishment of the Board's maximum budget must include participation of both the Mayor and the Council. In this case, however, the Mayor is attempting unilaterally to establish a new maximum, but nevertheless a maximum, which the Board can spend. His actions are in direct violation of the statute.
We find no merit in the District's argument that § 31-104 applies only to formulation of the budget, before appropriation. First, no such limit is present in the express wording of the statute, which must be our first guide for statutory interpretation. See Peoples Drug Stores, Inc. v. District of Columbia, 470 A.2d 751, 753 (D.C. 1983) (en banc). Second, even if the District is correct in contending that the Mayor's and Council's joint responsibility under § 31-104 is limited to budget formulation, we do not understand why the Mayor's unilateral action under Order 90-103 is not a "formulation," though not the initial formulation, of the Board's budget. Changing the budget of the Board, whether initially or through a process of amendment during the fiscal year, involves "establish the maximum amount of funds which will be allocated to the Board," precisely what § 31-104 requires the Mayor and Council to do together. *fn19 According to this statute, therefore, the Mayor cannot unilaterally reset the maximum amount of funds available to the Board of Education. See Evans v. Washington, 106 Daily Wash. L. Rptr. 1929, 1937 (D.C. Super. Ct. Sept. 7, 1978) (Belson, J.) ("However, once the Mayor and the Council have set the maximum amount of funds to be allocated to the Board [of Education] within the overall District government budget, and Congress has authorized appropriations, the Mayor's sole remaining responsibility is to provide the means by which expenditures are made.") (Emphasis added.)
The District argues that the legislative history of § 31-104 limits the Board's budgetary autonomy to determining the manner in which appropriated funds are allocated, and does not insulate the Board against a revised appropriation ordered by the Mayor. We note, initially, that legislative history is seldom relevant unless the statutory language is ambiguous. Varela v. Hi-Lo Powered Stirrups, Inc., 424 A.2d 61, 64 (D.C. 1980) (en banc). There is no ambiguity in this case. But even if we do consider the legislative history, see Peoples, 470 A.2d at 754, as the District invites, the District's Conclusion does not follow. All the history the District cites stresses the respective roles of the Mayor and the Council, acting together, in the budgetary process. *fn20 If anything, the history supports the Board's reading of § 31-104 that the Mayor and Council, not the Mayor alone, must act to recommend reduction of the Board's appropriation.
Also unavailing is the District's contention that the D.C. Appropriations Act, 1990, see (supra) note 18, implicitly overrides § 31-104 and empowers the Mayor to reduce the Board's appropriations. We recognize that this congressional act refers to funding and apportionment of debt reduction "by the Mayor" and expressly provides that each appropriation is but a "maximum amount" (with two exceptions not relevant here). See (supra) note 18. But unlike the Mayor's unilateral budgetary authority over the Public Library, see Hazel, slip op. at 9, 10 & n.11, the Mayor's budgetary authority over the Board of Education is limited to concurrent action with the Council -- a limitation Congress did not explicitly override in the 1990 Appropriations Act. Absent language in the 1990 Act that would change that concurrent authority, we cannot properly assume that the specific budgetary procedure outlined in the Self-Government Act, § 452, D.C. Code § 31-104 (1988) -- that the Mayor and Council together set the maximum Board budget -- has been repealed by implication. See United States v. Young, 376 A.2d 809, 813 (D.C. 1977); Goodwin v. District of Columbia Bd. of Ed., 343 A.2d 63, 65-66 (D.C. 1975).
The District argues, finally, that our rejection of its argument leaves the Board of Education immune from budget cuts. That is not the case. The Board is insulated only from budget cuts which the Mayor initiates unilaterally. Pursuant to § 31-104, the Board's budget is subject to reduction -- as indeed it was, two months earlier -- whenever the Mayor and the Council can agree that such cuts are appropriate and Congress approves. See also D.C. Code § 47-301 (c) (1990); Convention Center Referendum Comm. v. District of Columbia Bd. of Elections and Ethics, 441 A.2d 889, 906 n.31 (D.C. 1981) (en banc) (plurality opinion). But § 31-104 makes clear that the elected Board of Education retains fiscal insulation against the Mayor's unilateral interference. As Hazel noted in specifically excluding the Board of Education from the ruling: the language of the Self-Government Act "explicitly vests certain powers in the Board of Education and restricts the Mayor's budgetary authority over the Board." Hazel, slip op. at 10 n.11. *fn21 In fact, this court carefully limited Hazel to the Public Library and expressly left open the possibility that a case, such as this one, could come out differently: "we emphasize that our holding applies only to the Public Library; it does not necessarily extend to funding disputes involving other agencies, entities, or branches of the District of Columbia government." Id. slip op. at 2-3.
We do not ignore the fact that the Mayor has a duty under the Self-Government Act to take action to keep the District's budget in balance. See id. slip op. at 5-6. What is at issue in this case, however, is the Mayor's attempt to fulfill this duty by unilaterally calling for reduction of appropriations for the Board of Education. The Self-Government Act itself, § 452, D.C. Code § 31-104 (1988), expressly provides that the Mayor may not do so alone.
The judgment of the Superior Court is therefore