Ala. Dep't of Econ. v. Cmty. Serv. Programs of West Ala. Inc., 2080725.

65 So.3d 396

ALABAMA DEPARTMENT OF ECONOMIC AND COMMUNITY AFFAIRS

v.COMMUNITY SERVICE PROGRAMS OF WEST ALABAMA, INC.

2080725.

Court of Civil Appeals of Alabama.

April 30, 2010.Rehearing Denied Dec. 30, 2010.

Edward E. Davis, gen. counsel, Alabama Department of Economic and Community Affairs, for appellant.Jane L. Calamusa and Kathryn O. Pope of Rosen Harwood, P.A., Tuscaloosa, for appellee.PITTMAN, Judge.

This appeal is taken by the Alabama Department of Economic and Community Affairs (“ADECA”) from a judgment of the Tuscaloosa Circuit Court that purported to reverse alleged decisions of ADECA that terminated the authority of Community Service Programs of West Alabama, Inc. (“CSP”), to distribute federal block grants to low-income energy consumers in Hale County and limited CSP's authority to distribute such grants in nearby counties to a reimbursement basis on the stated grounds that (a) CSP had failed to include an elected official on its board from Hale County or a designee of such an official, and (b) CSP had failed to maintain an office in Greensboro, the county seat of and largest city in Hale County.

Pursuant to Alabama statutes, ADECA, as the successor to the former Alabama Office of State Planning and Federal Programs, is afforded authority over the disbursement of grants and other forms of federal-government assistance intended for the promotion of the health, safety, and general welfare of citizens of the state, and it is empowered to exercise all powers necessary and proper for the discharge of its duties, including promulgating reasonable rules and regulations. See Ala.Code 1975, §§ 41–9–207, 41–9–211, and 41–23–1. Among the federal-government assistance programs that fall within ADECA's regulatory auspices is the federal Low Income Home Energy Assistance Program (“LIHEAP”), under which the Secretary of Health and Human Services is authorized to make grants to states to assist low-income households in making payments for home-energy consumption. See Ala. Admin. Code (ADECA), r. 305–5–2–.01 et seq., and 42 U.S.C. § 8621 et seq. Further, ADECA is required by statute and rule to “coordinate its activities” under LIHEAP “with similar and related programs administered by the federal government,” such as those programs that had previously been administered under the federal Economic Opportunity Act of 1964 (Pub.L. No. 88–452, 78 Stat. 508) before its 1981 repeal. Ala. Admin. Code (ADECA), r. 305–5–2–.05; 42 U.S.C. § 8624(b)(4).

CSP is what is known as a “community action agency”; it serves six west Alabama counties: Bibb, Fayette, Greene, Hale, Lamar, and Tuscaloosa. As the United States Court of Appeals for the Tenth Circuit noted in Gilmore v. Salt Lake Community Action Program, 710 F.2d 632 (10th Cir.1983), “[t]he concept of the community action agency originated in Title II of the Economic Opportunity Act of 1964.” 710 F.2d at 633. Section 202(a) of that Act (Pub.L. No. 88–452, 78 Stat. 508) defined “community action program” as a program that, among other things, “mobilizes and utilizes resources, public or private, of any urban or rural, or combined urban and rural geographical area ... in an attack on poverty” and “is conducted, administered, or coordinated by a public or private nonprofit agency.” 78 Stat. at 516. Although Congress initially left open the issue of governance of such programs, in 1967 it amended the Economic Opportunity Act of 1964 to require private nonprofit agencies acting as community action agencies—that is, administering community action programs—to have a tripartite “governing board,” consisting of not more than 51 members, of members taken from three classes: local political officials; representatives of the poor in the area served; and officials of business, labor, religious, and other major community-interest groups. Pub.L. No. 90–222, § 211(b), 81 Stat. 672, 693. Specifically, Congress required that “one-third of the members of the board [be] public officials, including the chief elected official or officials, or their representatives, unless the number of such officials reasonably available or willing to serve [was] less than one-third of the membership of the board.” Id. (emphasis added).

In 1972, Congress amended the provisions of the Economic Opportunity Act pertaining to governance of community action agencies so as to require that one-third of the members of the tripartite board be elected public officials and to allow appointed public officials to fulfill the one-third requirement if an insufficient number of elected officials was available and willing to serve; that amendment dropped the federal requirement that “chief elected officials” either serve or be represented. Pub.L. No. 92–424, § 7, 86 Stat. 688, 690. Later, many provisions of the Economic Opportunity Act were repealed by the Community Services Block Grant (“CSBG”) Act of 1981, Pub.L. No. 97–35, 95 Stat. 357, which shifted the general responsibility for running a number of antipoverty programs from the federal government to the states in the manner explained by the United States District Court for the Middle District of North Carolina in Guilford County Community Action Program, Inc. v. Wilson, 348 F.Supp.2d 548, 552 (M.D.N.C.2004):

“Subsequently [ i.e., after enactment of the CSBG Act], funds to reduce poverty were allocated to the States through block grants. The States would then channel the funding to eligible entities, generally non-profit community action agencies, that specialized in poverty reduction. [42 U.S.C. § 9901.] In turn, those agencies provided funding to individuals and to programs designated to reduce poverty.”

Although the CSBG Act, as initially enacted, did not disturb previous Congressional enactments pertaining to the governance of community action agencies, language was added to the CSBG Act in 1994 providing for selection of the board “by the community action agency.” Pub.L. No. 103–252, § 202(c)(5), 108 Stat. 623, 652. Further, the CSBG Act was generally revised in 1998 so as to provide, as it does at the time of this opinion, (a) that the members of the board of a private, nonprofit entity administering community-services block grants “shall be selected by the entity,” but (b) that that board shall be composed so as to assure that one-third of its members are either elected public officials holding office on the date of selection or their representatives (or are appointive public officials or their representatives if there is an insufficient number of available and willing elected public officials). Pub.L. No. 105–285, § 201(a)(2) (now codified at 42 U.S.C. § 9910(a)(2)). For purposes of this opinion, we will hereinafter refer to 42 U.S.C. § 9910(a)(2) as “the federal statute” for clarity.

In 1982, in response to Congress's enactment of the CSBG Act, the Alabama Legislature enacted Act No. 82–494, Ala. Acts 1982, now codified at Ala.Code 1975, § 11–96–1 et seq., which provided that 95% of all moneys received from the federal government through the CSBG Act “shall be appropriated to community action agencies.” Ala.Code 1975, § 11–96–1. Act No. 82–494 further contained a definition of “community action agency” that included “private nonprofit agenc[ies] ... designated as ... ‘eligible entit[ies]’ ” under the CSBG Act. Ala.Code 1975, § 11–96–3(a). Finally, and most pertinent for the purposes of this case, the Alabama Legislature provided as follows:

“Each community action agency shall administer its programs through a governing board consisting of 15 to 51 members.

“(1) One-third of the members of the board shall be elected or appointed public officials, currently holding office or their representatives. These members shall be designated or approved by the chief elected local government official or officials of the jurisdiction which they represent.

“(2) At least one-third of the members shall be persons chosen in accordance with democratic selection procedures adequate to assure that they are representative of the poor in the area served by the agency.

“(3) The other members shall be officials or members of business, industry, labor, religious, welfare, education, housing, or other major groups and interests in the community. Each member of the board selected to represent a specific geographic area within an appointed community must reside in the area represented.

“Procedures for selection of board members shall be submitted to county commissions within the community action agency service area for their review. This procedure may be set out in the bylaws governing the community action agency.”

Ala.Code 1975, § 11–96–3(b) (emphasis added). For purposes of this opinion, we will hereinafter refer to § 11–96–3(b) as “the state statute” for clarity.

In March 2006, ADECA's director notified the chairman of CSP's board that ADECA had received “several complaints concerning the provision of services by [CSP] to Hale County,” including complaints of “inaccessibility of services” and “lack of representation on the Board.” The director of ADECA noted that CSP's sole office in Hale County at that time was not in Greensboro but in Sawyerville, a location approximately 15 to 20 miles away from Greensboro that, ADECA's director contended, was “inaccessible for many people because of transportation issues.” ADECA's director further noted that, at the time, CSP's tripartite board consisted of a total 15 members and that its 5 public officials consisted of 3 from Tuscaloosa County, 1 from Greene County, and 1 from Lamar County. ADECA's director suggested that CSP should increase its board membership to 18 people “in order for each County to have a public sector member approved by the local jurisdiction each represents.” In pertinent part, the letter directed that CSP “establish and have operational an office in Greensboro” within 60 days and that CSP's board “be revised” within 6 months “so as to be in compliance with,” among other things, “state and federal statut...