Effect of a Judicial Stay on
Administrative Fund Termination Proceedings
U n d e r th e n o n d iscrim in atio n p ro v isio n s o f th e O m nibus C rim e C o n tro l and Safe S tre ets
A ct o f 1972, th e ad m in istrativ e p ro cess by w h ic h funds are su sp en d ed o r term in a te d is
in d ep en d en t o f an y c o n tem p o ran eo u s ju d icial p ro c e e d in g , an d a stay e n te re d in the
ju d icial p ro ceed in g th u s has no effect on an ad m in istrativ e decision to suspend or
term in a te funds.
T h e L aw E n fo rcem en t A ssistance A d m in istratio n is free to d efer a d m in istra tiv e fund
suspension o r term in atio n p ro ceed in g s d u rin g th e p en d en cy o f a ju d icial stay, b ut is
fo reclo sed from re sto rin g funds th at h av e a lre a d y b een su sp en d ed o r term in a te d ex cep t
in a c c o rd a n c e w ith th e p ro c e d u re s set fo rth in th e O m nibus C rim e C o n tro l an d Safe
S treets A ct.
U n d e r th e n o n d isc rim in atio n p ro v isio n s o f th e R e v en u e S h arin g A c t, th e O ffice o f
R e v en u e S h arin g is req u ired to suspend ad m in istrativ e en fo rc em en t p ro ceed in g s, an d to
resto re funds a lread y su sp ended o r term in a te d , w h e n e v e r a stay is issued in th e ju d icial
p ro ceed in g th at trig g e re d th e ad m in istrativ e en fo rc em en t action.
M a r c h 14, 1980
MEMORANDUM OPINION FOR TH E ASSISTANT ATTORNEY
G EN ERA L, CIVIL RIGHTS DIVISION
This responds to your request for our opinion on the effect of a stay
pending appeal upon fund termination proceedings of the Office of
Revenue Sharing (ORS) in the Department of the Treasury under the
civil rights provisions of the State and Local Fiscal Assistance Act of
1972, as amended (Revenue Sharing Act), 31 U.S.C. § 1242, and upon
the Law Enforcement Assistance Administration (LEAA) under the
analogous provisions of the Omnibus Crime Control and Safe Streets
Act of 1972, as amended (Crime Control Act), 42 U.S.C. § 3789d(c).*
Both statutes include provisions that require the agencies to institute
their own enforcement proceedings whenever they learn of a judicial or
administrative determination that a recipient has discriminated in viola
tion of federal law, and both provide for automatic suspension of funds
to a recipient within a fixed time thereafter. The question has arisen
whether a stay pending appeal of a lower court order vacates or defers
administrative fund suspension.
•N o t e : U nder § 815(c) o f th e Justice Systems Im provem ent A ct o f 1979, Pub. L. N o. 97-157,
93 Stat. 1167, 1206-09, the O ffice o f Justice Assistance, Research and Statistics replaced L E A A as the
entity responsible for adm inistrative enforcem ent o f the nondiscrim ination provisions o f the C rim e
C ontrol A ct. Ed.
487
Your division takes the position that a stay has the legal effect of
vacating or deferring such suspension. Both the Department of the
Treasury and LEA A disagree. The two agencies maintain that the
administrative process by which funds are terminated under the two
acts is independent of any contemporaneous judicial proceeding,
whether or not the same issues of discrimination are involved, and
whether or not their administrative process has been triggered in the
first instance by a determination in the judicial proceeding. Therefore,
in their view a stay entered in the judicial proceeding has no effect on
an administrative decision to suspend funds. The Civil Rights Division
memorandum takes the position that the administrative role under both
statutes is merely “ancillary and supportive” of the judicial process, and
that the agencies are therefore obliged “to honor” a judicial stay by
suspending their administrative procedures or, if necessary, restoring
the flow of federal funds.
For reasons stated hereafter, we agree with your Division's position
on the effect of a stay on administrative fund suspension under the
Revenue Sharing Act, but find merit in the position advanced by
LEA A in interpreting its responsibilities under the Crime Control Act.
We believe the law requires ORS, whose actions are triggered by and
are to some extent dependent on a judicial determination, to conform its
actions to those of a court granting a stay. And we think that Congress
intended this administrative conformity to extend to the restoration of
funds already suspended or terminated. Although neither the terms nor
the legislative history of the relevant provisions of the Revenue Sharing
Act deal with the effect of a stay on ORS proceedings, we believe that
Congress intended to assure recipients of federal funds under that Act
an opportunity to contest a preliminary determination of discrimination,
and to avoid fund suspension by showing a likelihood of ultimate
success on the merits. Because in federal court one of the grounds for
granting a stay pending appeal in this context is precisely this likelihood
of success on the merits,1 we believe that Congress, had it considered
1 T h e Federal Rules o f C ivil P rocedure p ro v id e that an interlocutory o r final o rd er in an action for
an injunction will not be stayed except pursuant to the provisions o f Rule 62(c). This provides in
pertinent part that:
w hen an appeal is taken from an in terlo cu to ry o r final judgm ent granting, dissolving,
o r denying an injunction, the c o u rt in its discretion may suspend, modify, restore, o r
grant an injunction d uring the pendency o f the appeal upon such term s as to bond or
otherw ise as it considers p ro p er for the security o f th e adverse party.
R ule 8(a) o f the Federal Rules o f A ppellate P ro ced u re provides that a stay pending appeal ought in
the first instance to be sought in the district co u rt, but that a m otion for relief may be m ade in the
cou rt o f appeals w h ere such a course is not practicable o r w here the district c ourt has denied an
application. Because a stay itself has the effect o f an injunction o r restraining order, the requirem ent in
R ule 65(d) that it be accom panied by a statem ent o f reasons has been held to apply. See M oore's
F ederal P ractice § 62.05 at 62-21 through 22 (1979 ed.). A n applicant for a stay pending appeal under
F R C P R ule 62(c) o r F R A P R ule 8(a) must make a “stro n g show ing” that he will succeed on the
merits o f his appeal. See Belcher v. Birm ingham Trust N a t. Bank, 395 F.2d 685 (Sth Cir. 1968); Virginia
Petroleum Jobbers Ass'n v. FPC. 259 F.2d 921, 925 (D .C . Cir. 1958); M onde! v. H E W , 417 F. Supp. 57
Continued
488
the issue, would not have approved the continuance of administrative
procedures leading to fund termination in the face of a federal judicial
stay and in disregard of it.
The analogous provisions of the Crime Control Act differ signifi
cantly from those of the Revenue Sharing Act, however, and in our
view these differences make persuasive LEA A ’s argument that its own
administrative process was intended by Congress to be independent of
any concurrent litigation involving the same issues of discrimination. At
the same time, we believe that LEAA is free under its statute to defer
administrative fund suspension in the event of a judicial stay, and that
sound policy may in some cases dictate such deferral. Unlike ORS,
however, LEAA is probably foreclosed from restoring funds that have
already been suspended or terminated except in accordance with the
procedures set forth in its statute.
Because the relevant provisions of the two statutes differ markedly,
and because our conclusions with respect to their import for the two
agencies differ correspondingly, we discuss them separately.
I. The Crime Control Act
Section 518(c)(1) of the Crime Control Act, 42 U.S.C. § 3789d(c)(l),
prohibits discrimination on grounds of race, color, religion, national
origin or sex, by a state or local government, in a program or activity
receiving funds under a grant administered by LEAA. Section
518(c)(2), 42 U.S.C. § 3789d(c)(2), which was added to the Act in 1976
by Pub. L. No. 94-503, 90 Stat. 2418, sets out the administrative
procedures by which the nondiscrimination provisions in the preceding
paragraph are enforced. In relevant part these require LEAA, upon
receiving notice of a “finding” by a federal or state court or administra
tive agency to the effect that there has been a “pattern or practice” of
discrimination in violation of subsection (c)(1), to set in motion an
administrative procedure leading to suspension and, ultimately, termina
tion of funds. Under this procedure LEA A must notify the chief execu
tive of the affected governmental unit that a program or activity has
been found not to be in compliance, and must request that officer to
secure compliance. 42 U.S.C. §§ 3789d(c)(2)(A)(i) and (ii). If after 90
days compliance has not been secured, and if an administrative law
judge has not “made a determination under subparagraph (F) that it is
likely the state government or unit of local government will prevail on
the merits,” LEAA “shall notify” the Attorney General that compli
ance has not been secured “and caused [sic] to have suspended further
payment of any funds under this chapter to that program or activity.”
(D . Md. 1976). Professor M oore states that w here a c o u rt o f appeals grants a stay o f an interlocutory
order, “the grant o f such a stay seems tantam ount to deciding that the interlocutory injunction was
im properly g ran ted ." M oore's Federal Practice, § 62.05 at 62-26.
489
42 U.S.C. § 3789d(c)(2)(C). The “determination under subparagraph
(F)” is explained in that section as follows:
Prior to the suspension of funds under subparagraph (C),
but within the ninety day period after notification under
subparagraph (C), the State government or unit of local
government may request an expedited preliminary hearing
on the record in accordance with section 554 of title 5, in
order to determine whether it is likely that the State
government or unit of local government would, at a full
hearing under subparagraph (G), prevail on the merits of
the issues of alleged noncompliance. A finding under this
subparagraph by the administrative law judge in favor of
the State government or unit of local government shall
defer the suspension of funds under subparagraph (C)
pending a finding of noncompliance at the conclusion of
the hearing on the merits under subparagraph (G).
At the “full hearing” under subparagraph (G) referred to in this sec
tion, the issues of discrimination are heard on the merits, and LEAA
must make “a finding of compliance or noncompliance.” If LEAA
makes a finding of “noncompliance,” the Attorney General “may”
terminate the payment of funds. 42 U.S.C. § 3789d(c)(2)(G)(ii).
Once funds have been suspended by LEAA there are only four
circumstances, set out in subparagraph (D), under which payment may
be resumed: (1) if the recipient enters into a compliance agreement
approved by LEA A and the Attorney General; (2) if the recipient
“complies fully with the final order or judgment” of a court or adminis
trative agency, if that order or judgment covers all the matters raised in
L EA A ’s original notice of noncompliance; (3) if the recipient “is found
to be in compliance with subsection (c)(i) by such court”;2 and (4) if
after a hearing LEA A finds “that noncompliance has not been demon
strated.” 3 42 U.S.C. §§ 3789d(cX2)(D)(i) through (ii).
. This statutory scheme suggests an intention on the part of Congress
to limit agency discretion in certain respects (e.g., mandatory com
mencement of proceedings upon notice of a “finding,” and mandatory
suspension of funds 90 days thereafter); at the same time, it permits
LEA A to reach its own independent conclusions on the issues of
discrimination raised, and ultimately to make an independent decision to
lift or continue a suspension pending a full administrative hearing on
2 T h e statute inexplicably fails to give the same effect to a similar finding o f an adm inistrative
agency.
9 Subparagraph (D ) makes reference to a hearing “ pursuant to subparagraph (F ).” But subparagraph
(F ) describes the “expedited prelim inary hearing*’ before an adm inistrative law judge. It is subpara
graph (G ) w hich describes the full hearing in w hich L E A A determ ines the issue o f com pliance on the
merits. W e think the reference in subparagraph (D ) to subparagraph (F ) is mistaken, and that it should
instead be read as a reference to the hearing described in subparagraph (G).
490
the merits of the discrimination charge, by showing a likelihood of
success at a preliminary hearing. But the statute does not spell out what
relationship if any Congress intended there to be between L E A A ’s
enforcement procedures once they have been set in motion, and any
ongoing judicial or administrative proceedings which may have trig
gered them in the first place.
The legislative history of the 1976 amendments to the Crime Control
Act does little to clarify this relationship. It manifests congressional
dissatisfaction with the lack of initiative shown by LEAA in enforcing
the nondiscrimination provisions of the Act, and an intent to remedy
this by forcing the agency into action whenever a court or another
agency “finds” the recipient to have engaged in a “pattern or practice”
of discrimination. Thereafter, however, it would appear that LEA A
was perceived as having an enforcement role independent of contempo
raries and related court proceedings. The House report states that “the
Committee bill will require the Administration to honor the discrimina
tion findings of State and Federal courts and State and Federal agencies
by then beginning its own enforcement process with the sending out of
noncompliance notices to recipients found by others to have discrimi
nated.” H.R. Rep. No. 1155, 94th Cong., 2d Sess. 26 (1976) (emphasis
added).4
The more important evidence of LEA A ’s independence comes from
a reading of the statute itself, and from a comparison of its provisions
with the analogous provisions of the Revenue Sharing Act. Unlike the
Revenue Sharing Act, the Crime Control Act contains no provisions
requiring deference on the merits to the triggering “finding” in any part
of the administrative process. Rather, it would seem that this “finding”
operates on the agency only to spur it into “beginning its own enforce
ment process.” 5 As will be discussed in greater detail below, the
analogous sections of the Revenue Sharing Act are considerably more
explicit with respect to the further substantive effect that should be
given the triggering judicial determination.
4 T he Senate bill had made no changes in the nondiscrim ination provisions o f the C rim e C ontrol
A ct, and the conference com m ittee reported out provisions that w ere in all pertinent respects identical
to those in the H ouse bill. See H .R. Rep. No. 1723, 94th Cong., 2d Sess. 32 (1976).
5 O ne o f the difficulties in construing L E A A 's obligations under these provisions o f the statute is
C ongress' failure to define w hat it meant by a ‘‘finding.” It is not clear in the statute o r its legislative
history w h eth er this term was meant to include prelim inary o r interlocutory “ findings,” o r w hether it
should be limited to formal findings after a full hearing. L E A A 's ow n regulations do not define the
term, but that agency has apparently interpreted it to include the findings em bodied in a prelim inary
injunction order. If the “ finding" is view ed solely as a triggering m echanism, then w e w ould have no
basis on w hich to quarrel w ith L E A A 's expansive definition o f the term. If, on the o th e r hand, a
“ finding’' w ere to be considered m ore o r less determ inative o f the agency's ow n actions on the m erits
in connection w ith fund suspension, as it appears to be under the R evenue Sharing A ct, w e w ould be
less com fortable w ith the notion that C ongress intended to include in the term “finding" any statem ent
or action o f a court w ith respect to a com plaint b rought before it. See note 8 infra. It is precisely
because under the C rim e C ontrol A ct a c o u rt's “ findings" are not substantively binding on L E A A that
we are constrained to agree w ith that agency on the legal effect o f a stay.
491
To be sure, the Crime Control Act provides that payment of sus
pended funds should be resumed if the recipient “complies fully with
the final order or judgment” of a court. But, by implication, any court
action short of a “final order or judgment” would in itself permit no
such resumption. Therefore, when funds have already been suspended
by LEAA, a stay in the related judicial proceeding does not, in our
opinion, have any effect on the suspension. On the other hand, where
funds have not yet been suspended and the agency inquiry is still under
way, the statute does not appear to compel any particular agency
response to developments in litigation involving the same issues. The
opportunity provided the recipient in subparagraph (F) to defer suspen
sion by demonstrating a likelihood of success on the merits before an
administrative law judge suggests a general congressional policy under
lying the Act which we think would permit LEAA to defer its own
suspension proceedings where a stay has been granted by the court
whose “findings” triggered those proceedings in the first place. This is,
however, a matter of policy and not a matter of law.
In sum, based on our reading of § 518(c)(2) of the Crime Control Act
and its legislative history, we agree with LEA A that its administrative
process is independent of the triggering judicial or administrative pro
ceedings; that suspended funds may be resumed only upon the happen
ing of one of the events specified in subparagraph (D); and in particular
that it is not required under the statute to bring its own administrative
process to a halt in the event a stay is obtained in a contemporaneous
and related judicial proceeding. On the other hand, we do not think
LEAA is precluded from taking into account the implications of a stay
order in the course of its own pre-suspension proceedings. The congres
sional policy reflected in subparagraph (F) would fully support a deci
sion by LEAA to honor such a stay, and defer suspension pending a
full administrative hearing on the merits. Indeed, we think in some
circumstances LEAA would not be remiss in its responsibilities under
the statute in deferring all administrative action pending a resolution of
the issues raised in the court proceeding.6
II. The Revenue Sharing Act
The 1976 amendments to the Revenue Sharing and Crime Control
Acts were passed on October 13 and 15 of that year, respectively. In
both cases Congress was seeking to strengthen the nondiscrimination
8 L E A A 's ow n regulations appear to recognize the desirability o f coordinating its enforcem ent
efforts w ith contem poraneous litigation involving the same issues. F o r exam ple, the regulations
provide that if an L E A A com plainant has also filed suit in federal o r state court, and if the trial o f the
suit w ould be in progress during the L E A A investigation, L E A A “ will suspend its investigation and
m onitor the litigation through the co u rt docket and co n tacts w ith the com plainant." 28 C .F .R .
§ 42.205(c)(5). In addition, w hen a triggering “ finding" has been m ade m ore than 120 days before
L E A A learns o f it, notification o f noncom pliance will be deferred pending an inquiry into the current
status o f the case. 28 C .F .R . § 42.210(c).
492
enforcement provisions of prior law, and to provide mechanisms to
compel the two agencies to commence proceedings looking toward
termination of federal funds in the event a recipient state or local
government were found by a court or agency to have discriminated in
violation of federal law. The provisions intended to accomplish this
objective in the two Acts turned out quite differently, however, primar
ily because the Senate took an active role in amending the Revenue
Sharing Act and displayed little or no interest in the nondiscrimination
provisions in the Crime Control Act. The House bills amending both
Acts contained essentially identical enforcement provisions. These were
enacted without substantive change into the Crime Control Act amend
ments, and without any separate contribution from the Senate. See note
4 supra. But the Senate had its own proposals to make with respect to
the Revenue Sharing Act, proposals that were quite different from
those of the House, and that were in the main accepted by the Confer
ence Committee.
The “compromise” 7 reached in conference between the House and
Senate on the nondiscrimination enforcement programs of the Revenue
Sharing Act was enacted into § 122 of the Act by Pub. L. 94-448, 90
Stat. 2350, and is codified in § 1242 of title 31. A brief review of its
pertinent provisions shows how the Senate’s approach differed from
that of the House in the Crime Control Act. Like the analogous
provisions of the Crime Control Act, § 122(b)(1) contains a triggering
mechanism for the commencement of administrative enforcement pro
ceedings leading to fund termination. This triggering mechanism is
described in § 122(c)(1) as a “holding” by a federal or state court, or
federal administrative law judge, that the recipient state government
has discriminated in violation of federal law.8 Once the Secretary of
the Treasury has received notice of a “holding,” a notice of noncompli
ance must be sent the recipient, and the fund termination procedure set
in motion.9 Subsections (b)(2) and (b)(3) describe a hearing procedure
7 122 Cong. Rec. 34,099 (Sept. 30, 1976) (rem arks o f Rep. D rinan, a sponsor o f the bill in the
House).
8 Unlike the triggering events in § 518(c)(2) o f the C rim e C ontrol A ct, the triggering events under
the R evenue Sharing A ct are not restricted to a “ pattern o r practice” determ ination, and no effect is
given determ inations o f a State adm inistrative agency.
9 A lthough you have not asked o ur opinion on the issue o f w h eth er a “ holding" under the Revenue
Sharing A ct includes an interlocutory o rder, we note the position o f O R S that it does include such
orders in reaching o u r ultim ate conclusions on the effect o f a stay o f such an order. In its regulations,
O R S defines a “ holding" as “any finding o f fact o r conclusion o f law . . . w hich has been litigated
. . .“ 31 C .F .R . § 51.67(a). O R S has taken the position that a prelim inary injunction constitutes a
“ holding" for purposes o f triggering its adm inistrative fund suspension procedure, a position w hich we
do not understand your Division to dispute. L E A A appears to take the sam e position w ith respect to a
“ finding" under the Crim e C ontrol A ct. See note 5 supra.
W e also note here that w e d o not think C ongress intended to attach any particular significance to
the use o f the term “holding" in the Revenue Sharing A ct, as opposed to the term “ finding" used by
the Crim e C ontrol A ct. N o difference betw een the tw o term s w as asserted in Congress, and none has
been claim ed by either L E A A o r O RS. A s it happened, the term “ holding" was the one em ployed by
the Senate in its revenue sharing bill, and the term “ finding" was em ployed by the H ouse in both its
crim e control bill and its revenue sharing bill. T he term s “ holding" and “ finding" are used inter*
Continued
493
before the Secretary of the Treasury and, if requested subsequently, an
administrative law judge. It is at this point that the two statutes part
ways. Where the two-step hearing procedure under the Revenue Shar
ing Act has been triggered by a “holding” on the issues of discrimina
tion, the substance of this “holding” may not be collaterally attacked
before either the Secretary or the administrative law judge. That is, the
recipient may present evidence to the Secretary only on the issue of
whether the program or activity in which discrimination is charged has
been federally funded, and not on the merits of the discrimination
charge itself. If the Secretary determines that federal funds are in
volved, and if the recipient then requests a further hearing before an
administrative law judge, that officer too is precluded from addressing
the discrimination issue on the merits. In case there remains any doubt,
subsection (c)(2) restates the restrictions on the administrative process
as follows:
If there has been a holding described in paragraph [(c)(1)]
with respect to a State government or a unit of local
government, then, in the case of proceedings by the Sec
retary pursuant to subsection (b)(2) of this section or a
hearing pursuant to subsection (b)(3) of this section with
respect to such government, such proceedings or such
hearings shall relate only to the question of whether the
program or activity in which the exclusion, denial, dis
crimination, or violation occurred is funded in whole or
in part with funds made available under subchapter I of
this chapter. In such proceedings or hearing, the holding
described in paragraph [(c)(1)] . . . shall be treated as con
clusive.
31 U.S.C. § 1242(c)(2) (emphasis added). Unless the Secretary or admin
istrative law judge finds that the program in which discrimination is
charged is not federally funded, the Secretary “shall” suspend payment
of funds.
Subsection (e) of the statute sets out the five grounds on which
suspended payments may be resumed where a “holding” has triggered
the suspensions: 1) if the recipient government enters into a compliance
agreement with the government agency or office responsible for pros
ecuting the claim or complaint which is the basis for the holding, if the
agreement has been approved by the Secretary;10 2) if the recipient
government “complies fully with the holding,” if that holding covers
all matters raised in the Secretary’s notice of noncompliance; 3) if the
changeably in both the Senate rep o rt and the conference report on the revenue sharing bill, suggesting
that that body did not focus at ail on the difference, if any. betw een them. See S. Rep. No. 1207, 94th
C ong., 2d Sess. 32 (1976); H .R. Rep. No. 1720, 94th C ong., 2d Sess. 35-36 (1976). Indeed, in discussing
the conditions for resum ption o f funds both reports speak o f com pliance w ith an “o rd e r’* o f a federal
court, w here the statute uses the term “ holding.” Id. See 31 U.S.C. 1242(e)(2).
10 T h e com pliance agreem ent is described in subsection (d)(1).
494
recipient is found to be in compliance by the court or agency that
issued the holding; 4) if the administrative law judge determines that
the recipient is in compliance under subsection (b)(3)—a determination
which may be based only on the presence or absence o f federal funds,
not the merits of the discrimination claim; and 5) if the body that has
issued the triggering holding is reversed by an appellate tribunal. This
final condition of lifting the suspension is also dealt with in subsection
(c)(3):
If a holding described in paragraph [(c)(1)] is reversed by
an appellate tribunal, then proceedings under subsection (b)
o f this section which are dependent upon such holding shall
be discontinued; any suspension or termination of pay
ments resulting from such proceedings shall also be dis
continued.
31 U.S.C. § 1242(c)(3) (emphasis added).
The acknowledgment in subsection (c)(3) that the administrative pro
ceedings are “dependent” on the proceedings in the triggering body is
reflected generally in the grounds for resumption of suspended pay
ments described above. Three of the five grounds are for all practical
purposes beyond the control of the Secretary: the first, a compliance
agreement, is grounds for resumption of payment only where it is
entered into by the parties to the triggering lawsuit or complaint. The
third ground depends on the recipient’s compliance as determined by
the triggering body. And the fifth ground depends entirely on the
action of an appellate tribunal in reversing the triggering holding.
Although there is some independent role reserved to the agency with
respect to the first, second, and fourth grounds, the agency is always
bound to follow the lead of the triggering body whenever the merits of
the discrimination issue are involved.
The congressional concern to limit the independent enforcement au
thority of the Secretary of the Treasury where there has been a prior
holding of discrimination is reflected in the legislative history of the
1976 amendments to the Revenue Sharing Act. As with the Crime
Control Act, Congress was aware of widespread dissatisfaction with the
agency’s failure to use its suspension power even where the recipient
agency had been adjudged by a federal court to be in violation of the
law. See Hearings before the Subcomm ittee on Revenue Sharing o f the
Senate Finance Committee, 94th Cong., 1st Sess. 173, 197, 214 (1975).
See also United States v. City o f Chicago, 395 F. Supp. 329 (N.D. 111.
1975), a f f d 525 F.2d 695 (7th Cir. 1976). However, the Senate’s contri
bution to the provisions that emerged in 1976 as the Conference “com
promise” reflected equally strong concerns to minimize the burden of
enforcement on ORS staff, and “to safeguard the due process rights of
the recipient.” S. Rep. No. 1207, 94th Cong., 2d Sess. 29 (1976). These
concerns resulted in the development of provisions limiting the discre
495
tion of ORS where a court or federal agency proceeding was in
progress.
The hearings in the Senate Finance Committee in August of 1976
took place after the House had reported out its bill amending the
Revenue Sharing Act. That House bill contained nondiscrimination
enforcement provisions virtually identical to those ultimately enacted in
the Crime Control Act. The Senate committee was not satisfied with
these provisions on two grounds: first, they placed too heavy an en
forcement responsibility on the staff of the Office of Revenue Sharing,
whose officers testified that they did not wish to assume a larger role in
civil rights enforcement; and second, they failed to afford a recipient
government adequate protection against administrative arbitrariness and
duplicative hearings. The General Counsel of the Treasury Department
testified that the elaborate procedures set forth in the House bill
“would really require a multiplication of the staff with very little effect
overall,” and that “the mechanics set up in the House-passed bill would
create tremendous administrative burdens.” Hearings before the Senate
C om m ittee on Finance on H .R. 13367, 94th Cong., 2d Sess. 48-49 (1976).
He recommended that more reliance be placed on the ability of a court
to monitor compliance, and less on the independent ability of ORS to
enforce the law. The committee also heard testimony from a number of
state and local government officials. The comments of Patrick Lucey,
G overnor of Wisconsin, are typical:
An ideal system of anti-discrimination enforcement would
emphasize both due process and simplicity to preclude the
federal government from arbitrarily suspending revenue
sharing funds in any jurisdiction. Deadlines should be
short, and findings of discrimination should be based on
the administrative and judicial process which does not
rely solely on the judgment of the Secretary of the
T reasury.
Id. at 89. Kenneth Gibson, Mayor of Newark, New Jersey, complained
that “federal civil rights enforcement requirements are oftimes duplica
tive and contradictory in nature.” He recommended that “a strategy be
developed to consolidate and coordinate federal civil rights enforce
ment in general and that due process be observed in any withholding of
funds from local government.” Id. at 92-93. In a colloquy with Senator
Packwood, Mr. Gibson and John Poelker, Mayor of St. Louis, dis
cussed the due process problems inherent in simultaneous and poten
tially contradictory administrative and judicial proceedings. Senator
Packwood asked how to construct “a fair section” that would not
“unduly penalize” a recipient during the pendency o f a court suit.
Poelker recommended that “[i]t should be left up to the decision o f the
court, not the Secretary. . . . As long as the suit is pending, and the
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locality has not been found in violation until that time,” funds should
not be suspended. Both Mayors Poelker and Gibson emphasized that in
their opinion the inequity of terminating funds prior to “the end of the
suit” outweighed the possibility of undesirable continuance of funds
during its pendency. Id. at 77-78.
The general criticism of. the House bill in the Senate committee led
to the drafting of the provisions that eventually were enacted as § 122.
The problems of delay, unfairness, and duplication that witnesses per-,
ceived to be inherent in the House approach were sought to be re
solved by provisions linking the ORS administrative role more closely
with proceedings brought before courts and other agencies. The Con
ference Committee accepted the Senate bill in all pertinent respects.
H.R. Rep. No. 1720, supra, at 34.
From the foregoing discussion it is clear that the terms of the civil
rights enforcement provisions of the Revenue Sharing Act and their
legislative history are substantially different from those of the Crime
Control Act. We believe these differences warrant a different conclu
sion with respect to the effect a stay on administrative fund suspension
proceedings under the two acts. Under the Crime Control Act, once
the administrative enforcement proceeding has been triggered by a
“finding,” LEAA operates independently of the finding. Under the
Revenue Sharing Act, ORS proceedings are “dependent” from begin
ning to end on the concurrent judicial or federal agency proceedings.
Since ORS is barred from making its own determination on the issue of
discrimination once there has been a court determination, we think it
must also respect the court’s subsequent decision to stay the effect of
that determination. This is consistent with the Senate’s concern not to
burden ORS staff with massive civil rights enforcement responsibilities,
and to ensure recipient governments due process of law. In the case of
LEAA, however, to the extent that that agency remains free to reach
its own decision on the merits of the discrimination issues prior to'
suspending funds, we do not believe the law requires it to honor a
judicial stay—although we also think that it may do so in its discretion.
L a r r y L . S im m s
D eputy Assistant Attorney General
Office o f Legal Counsel
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