Absalom I. JORDAN, Jr., Petitioner, v. PUBLIC SERVICE COMMISSION, Respondent, Potomac Electric Power Company, Intervenor.
No. 91-AA-387.
District of Columbia Court of Appeals.
Argued Sept. 1, 1992. Decided March 16, 1993.
622 A.2d 1106
ORDERED that respondent, Clifford C. Cooper, is disbarred from the practice of law in the District of Columbia pursuant to
Anthony W. Robinson and John A. Turner, Minority Business Enterprise Legal Defense & Education Fund, Inc., for petitioner.
Josephine Scarlett-Simmons, Staff Counsel, Public Service Com‘n, with whom Daryl L. Avery, Gen. Counsel, and Lisa C. Wilson, Staff Counsel, were on the brief, for respondent.
Brian J.H. Lederer, for intervenor.
Lloyd N. Moore, Jr., with whom Kirk J. Emge, Joy A. Johnson, and John J. Sullivan were on the brief, for intervenor.
Before SCHWELB, WAGNER and KING, Associate Judges.
SCHWELB, Associate Judge:
Petitioner Absalom I. Jordan, a customer and shareholder of Potomac Electric Power Co. (PEPCO), has asked this court to review two orders of the Public Service Commission (PSC or the Commission). In Order No. 9540, dated August 24, 1990, the Commission dismissed withоut a hearing Jordan‘s complaint that PEPCO had failed to comply with the federal Small Business Act,
Before this court, Jordan contends that the complaint against PEPCO should not have been dismissed without a hearing and that the Commission applied incorrect legal standards. We vacate the Commission‘s order of dismissal and remand for further proceedings.
I.
THE PROCEEDINGS BEFORE THE COMMISSION
In 1978, Congress passed amendments to the Small Business Act which are now codified in
small business concerns, and small business concerns owned and controlled by socially and economically disadvantaged individuals, shall have the maximum practical opportunity to participate in the performance of contracts let by any Federal agency.
To promote this policy, Congress required federal agencies to include in their contracts various provisions designed to improve the opportunities of members of rаcial and ethnic minorities and other disadvantaged persons to participate as subcontractors. See, e.g.,
The Small Business Act also imposes direct obligations upon prospective prime contractors. Section
the apparent successful offeror shall negotiate with the procurement authority a subcontracting plan which incorporates the information prescribed in paragraph (6). The subcontracting plan shall be included in and made a material part of the contract.
The subcontracting plan must include, among other things, percentage goals for use as subcontractors of small business concerns, including enterprises owned and controlled by socially and economically disadvantaged individuals. See, e.g.,
In his complaint to the PSC, filed on May 25, 1989, Jordan claimed that PEPCO, a federal contractor, had violated the Act because it had failed to negotiate and to institute the required subcontracting plan. In his submissions to the Commission, Jordan alleged that, beginning approximately in 1980, the General Services Administration (GSA) had sought compliance by PEPCO, but that PEPCO had contended that its activities were not covered by the Act and had refused to comply with its provisions. In 1985, according to Jordan, GSA requested an opinion from the Department of Justice (DOJ) regarding PEPCO‘s claims of lack of coverage. In March, 1987, DOJ issued an opinion in which it concluded that the Act applies to PEPCO. Jordan alleged that in spitе of the DOJ ruling, it was not until August 29, 1989, three months after he had filed his complaint with the Commission, that PEPCO signed a subcontracting plan as required by the Act.2
The legal basis for Jordan‘s submission was
[t]he Commission shall have power, after hearing and notice by order in writing, to require and compel every public utility to comply with the provisions of Chapters 1-10 of this title, and with all other laws of the United States applicable, and any municipal ordinance or regulation relating to said public utility....
Jordan contends that § 637(c) is a law of the United States applicable to PEPCO, and that the Commission therefore has the authority to compel PEPCO to comply with it.
In his initial complaint, Jordan alleged that PEPCO‘s violation of § 637(c) had subjected the utility to potential liabilities, and he asked the Commission to require PEPCO to disclose these liabilities and to “make appropriate changes to PEPCO‘s rate base.” In subsequent submissions, Jordan and MBELDEF requested additional affirmative relief. Specifically, they asked that the Commission require PEPCO, among other things:
- to comply with § 637(c) by “having an appropriate share of its business with minority contractors;”
- to fund a study to determine the harm suffered by minority contractors as a result of PEPCO‘s noncompliance, and to determine the current availability of minority businesses capable of providing satisfactory services under a valid subcontracting plan;
- to advertise in local media its intent to comply with the Small Business Act;
- to hire a minority consulting firm to review PEPCO‘s management structure; and
- to pay Jordan‘s counsel fees.3
Notes
Commission to compel compliance with laws and ordinances.
The Commission shall have power, after hearing and notice by order in writing, to require and compel every public utility to comply with the provisions of Chapters 1-10 of this title, and with all other laws of the United States applicable, and any municipal ordinance or regulation relating to said public utility, and to conform to the duties upon it thereby imposed or by the provisions of its own charter, if any charter has or shall be granted it: Provided, that nothing herein contained shall be held to relieve any public utility, its officers, agents, or servants, from any punishment, fine, forfeiture, or penalty for violation of any such law, ordinance, regulation, or duty imposed by its charter, nor to limit, take away, or restrict the jurisdiction of any court or other authority which on March 4, 1913, had or which may thereafter have power to impose any such punishment, fine, forfeiture, or penalty.
During the pendency of the proceedings before the Commission, PEPCO reached agreement with GSA as to a mutually acceptable areawide subcontracting plan. Based on its acceptance of this plan, GSA represented to the Commission that “no genuine issue exists as to whether PEPCO is currently in violation of [§ 637(c)].” GSA therefore requested the Commission to dismiss the proceeding against PEPCO.
II.
THE COMMISSION‘S RULINGS
Although Jordan requested an evidentiary hearing on his complaint, the Commission did not hold one. Instead, on August 24, 1990, the Commission issued Order No. 9540, in which it held that PEPCO was covered by the Small Business Act, but that no violation of the Act had occurred and that no remedial action was appropriate. The determination that the Act had not been violated was based on the Commission‘s belief that
there was a good faith 5 legal dispute as to whether PEPCO was covered by the Act, although [the Commission] notes that from 1975 to the present is a long time to refuse to acknowledge coverage and take no action to resolve the issue.
The Commission also concluded that “the question [whether there had been a violation] is moot given the execution of an areawide contract with GSA.”
In Order No. 9646, the Commission further elaborated on its rationale as follows:
The Commission‘s conclusion that no violation of the Act has occurred was based upon the uncontrovertible [sic] fact that the issue under consideration was compliance by PEPCO with a Federal Act. Despite the protestations of MBELDEF and Kingwood, GSA, the agency charged with enforcing the Act, is satisfied with PEPCO‘s compliance. Now it appears the MBELDEF and Kingwood seek an expansion of this Commission‘s review. The question of the adequacy of the compliance and the diligence of the agency charged with enforcing the Act are questions best directed elsewhere.6
LEGAL DISCUSSION
A. The Scope of Review.
The scope of this court‘s review of the Commission‘s orders is narrow. Jackson v. Public Service Comm‘n, 590 A.2d 517, 521 (D.C.1991) (per curiam). “In the determination of any appeal from an оrder or decision of the Commission the review by the [c]ourt shall be limited to questions of law, including constitutional questions....”
When reviewing the Commission‘s legal determinations with respect to matters within its specialized competence, we must be appropriately deferential. Winchester Van Buren Tenants Ass‘n v. District of Columbia Rental Hous. Comm‘n, 550 A.2d 51, 55 (D.C.1988). The weight to be accorded to the Commission‘s legal views is at its zenith when the inquiry relates to arcane questions regarding proposed rate increases. See, e.g., Office of People‘s Counsel v. Public Service Comm‘n, 399 A.2d 43 (D.C.1979). The Commission has no intrinsic expertise, on the other hand, in interpreting federal statutes such as § 637(c), which have no special application to public utilities, and which were obviously enacted without any participation by the Commission. See Zuber v. Allen, 396 U.S. 168, 192-93 (1969).
B. The Commission‘s Enforcement Authority.
In the present case, the District of Columbia statute which the Commission was called upon to apply was
In PEPCO I, the Commission confronted the question whether it had the authority to consider allegations that PEPCO had engaged in racially discriminatory employment practices and, if so, whether it should exercise that authority. Citing
There can be no doubt that the provision of equal employment opportunity is required by the laws of the United States and thе District of Columbia.... When it is brought to our attention that the requirements of the law are not being met by a utility subject to our jurisdiction, we are clearly expected to act.
PEPCO I, at 41. Rejecting an argument by PEPCO similar to the one the utility is making in the present case, the Commission continued:
PEPCO suggests that we need take no action and that the matter should simply be referred to other organs of [g]overnment concerned with discrimination, e.g., the Equal Employment Opportunity Commission [EEOC], the U.S. Department of Labor, or the D.C. Human Relations Commission. For the reasons already discussed, we do not agree. We have both the power and the responsibility to take action ourselves.
Id. at 43.
The Commission then turned its attention to the appropriate remedy. After describing the evidence of past noncompliance which it had uncovered, the Commission held that “[t]here must be a program for affirmative action to eliminate employment discrimination.” Id. The Commission directed that PEPCO institute forthwith an affirmative action program which the Commission had “worked out” with the assis-
The Commission did not discuss Order No. 5429 in either of its written decisions in the present case. Rather, it based its ruling on its perception that PEPCO had not violated the Small Business Act, that the proceeding was moot, and that it lacked authority to act in light of GSA‘s role. We consider eаch of these issues in turn.
C. The Commission‘s Findings of No Violation and Mootness.
The Commission concluded that PEPCO did not violate the Act because there was a “good faith” legal dispute as to coverage. We do not agree.
A good faith dispute as to coverage, assuming that there was one,9 is irrelevant to the question whether PEPCO violated the Act. Section
Counsel have cited us to no authority, and we know of none,10 holding that a statute designed to eliminate the effects of racial or ethnic discrimination does not apply to a defendant simply because that defendant believes, in good faith or otherwise, that he or she is not subject to its proscriptions. Congress did not intend to make the right to fair and equal treatment contingent upon the victim‘s ability to prove mens rea or a specific intent to transgress. See Albemarle Paper Co., supra, 422 U.S. at 422, 95 S.Ct. at 2374.
We are likewise unable to agree with the Commission‘s apparent view that the case is now moot and that the Commission therefore lacks authority to act. Assuming, without deciding, that the plan adopted by PEPCO after Jordan had filed his complaint was in compliance with the Act, there remains the question whether there were any consequences flowing to third parties due to PEPCO‘s past failure to comply. The authority to grant relief “survives discontinuance of the illegal conduct.” United States v. W.T. Grant Co., 345 U.S. 629, 632, 73 S.Ct. 894, 897, 97 L.Ed. 1303 (1953); see also United States v. Oregon State Medical Society, 343 U.S. 326, 334, 72 S.Ct. 690, 696, 96 L.Ed. 978 (1952).
D. Deferral to GSA.
In Order No. 9540, the Commission held that there was no need for it to take corrective action because it is GSA which “determines compliance in accordance with its statute, rules and regulations.” The Commission viewed its own authority as extending only “to determining whether its statute, rules or regulations have been violated and enforcing certain remedies contained in the D.C.Code.” The Commission
We do not suggest that PEPCO I necessarily controls the present case. There are evident differences between the equal employment opportunity laws and the Small Business Act provisions here at issue. Significantly, the affirmative subcontracting requirements of § 637(c) do not apply to the generality of employers, but only to those who seek to do business with federal agencies and who are otherwise subject to the Act. Section 637(c) essentially governs the relationship between the federal gоvernment and its contractors. Many of the Act‘s provisions are directed to federal agencies and only indirectly to affected private entrepreneurs.
The primary role of the federal government in monitoring this relationship can hardly be denied. The request by the GSA that the Commission dismiss Jordan‘s complaint potentially raises an issue of comity which apparently did not arise in the employment discrimination context. Indeed, in PEPCO I, rather than seeking termination of the Commission‘s proceedings against PEPCO, the EEOC assisted the Commission in formulating the appropriate affirmative relief.
Whether, under these circumstances, the case may and should proceed is, in the first instance, a matter for the Commission. That agency should, however, at least consider its own twenty-two-year-old precedent in PEPCO I, and explain whether and to what extent its reasoning in that case applies here. Cf. Potomac Electric Power Co. v. Public Service Comm‘n, 457 A.2d 776, 783-84 (D.C.1983). Whatever the limits of our scope of review in this unusual case may be, “our authority—and responsibility—to find out why an agency acts as it does is considerable.” Washington Public Interest Organization v. Public Service Comm‘n, 393 A.2d 71, 79 (D.C.1978), cert. denied, 444 U.S. 926, 100 S.Ct. 265, 62 L.Ed.2d 182 (1979). We are not persuaded that the Commission has adequately analyzed its own responsibilities under the applicable District of Columbia statute as construed in PEPCO I.
According to Jordan, the Commission‘s all but plenary power under
We emphasize that this is not a case in which the Commission recognized that it had the authority to proceed with Jordan‘s complaint but elected not to do so as a matter of litigation priorities, or in order to avoid duplication of effort with a federal agency. If the dismissal had been based on the exercise of prosecutorial discretion or on the Commission‘s reasoned allocation of limited resources, the issue before us would be quite different. We recognize, for example, that if the Commission were to take the position that it should assume the primary obligation to enforce federal contracting policies, then the ratepayers of the District of Columbia, rather than the federal taxpayers (who fund the General Services Administration) would have to foot the bill. As we recently reiterated in Simpson v. District of Columbia Office of Human Rights, 597 A.2d 392, 398 (D.C.1991),
[c]ourts are understandably and rightly reluctant to tell an agency when it should institute enforcement proceedings and when it should not, for “[t]he agency is
far better equipped than the courts to deal with the many variables involved in the proper ordering of its priorities.” Heckler v. Chaney, 470 U.S. 821, 831-32, 105 S.Ct. 1649, 1656, 84 L.Ed.2d 714 (1985).
In the present case, however, the Commission did not purport to be exercising prosecutorial discretion. Rather, it believed that it had no authority to act. It is this dispositive holding that the Commission must reconsider in the light of its own precedents. If the Commission concludes on remand that it has the statutory authority to entertain Jordan‘s complaint, then it must determine whether it is obliged to do so, cf. PEPCO I,11 or whether, as appears more plausible, the decision to proceed or not to proceed is discretionary. If the Commission concludes that this determination is a discretionary one, then the Commission must elect whether to defer to GSA or to act independently.
IV.
CONCLUSION
For the foregoing reasons, the decisiоn of the Public Service Commission dismissing Jordan‘s complaint is hereby vacated, and the case is remanded for further proceedings consistent with this opinion.12
So ordered.
WAGNER, Associate Judge, dissenting:
A principal issue before this court is whether the Public Service Commission (PSC or Commission) properly determined the scope of its authority under
It was entirely reasonable for the Commission to conclude that any action under
In its ruling, the Commission recognized not only the limits of its own power under
We deal here with such an area of federal interest where intrusions of local authority over the terms of federal contracts specified by statute cannot be countenanced and where the involvement by the individual states or other local governments would be disruptive to the federal scheme. The very nature of the interest involved here raises an inference of local exclusion. That interest is participation of small business concerns and the socially disadvantaged in the federal procurement system through federally mandated and enforced contract provisions. Thus, I cannot agree with the majority that the Commission erred in dismissing that aspect of the petitioner‘s complaint which sought to compel PEPCO to negotiate a contracting plan with GSA after GSA had already approved PEPCO‘s plan and executed a contract.
Similar considerations lead me to conclude that the Commission properly dismissed petitioner‘s related requests for certain remedial relief for claimed past transgressions by PEPCO. As the Commission concluded, the remedies sought by petitioner are not within its statutory powers. See
The statute provides for inclusion of a liquidated damages provision in federal contracts payable, “upon a finding that a prime contractor has failed to make a good faith effort to comply with the requirements imposed [by § 637(d)].”
The contractor shall be afforded an opportunity to demonstrate a good faith effort regarding compliance prior to the contracting officer‘s final decision regarding the imposition of damages and the amount thereof. The final decision of a contracting officer regarding the contractor‘s obligation to pay such damages, or the amounts thereof, shall be subject to the Contract Disputes Act of 1978 (41 U.S.C. 601-603).
(C) If, within the time limit prescribed in rеgulations of the Federal agency concerned, the apparent successful offeror fails to negotiate the subcontracting plan required by this paragraph, such offeror shall become ineligible to be awarded the contract. Prior compliance of the offeror with other such subcontracting plans shall be considered by the Federal agency in determining the responsibility of that offeror for the award of the contract.
(D) No contract shall be awarded to any offeror unless the procurement authority determines that the plan to be negotiated by the offeror pursuant to this paragraph provides the maximum practicable opportunity for small business concerns owned and controlled by socially and economically disadvantaged individuals to participate in the performance of the contract.
I cannot agree with the majority that the Commission‘s failure to characterize one of its legal positions in “recognizable preemption terms” either precluded the parties from addressing the point or forecloses this court from considering the legal correctness of its ruling. See Common Cause v. Federal Election Comm‘n, 285 U.S.App.D.C. 11, 12, 906 F.2d 705, 706 (1990) (agency decision of less than idеal clarity will be upheld if its path can be reasonably discerned) (quoting Bowman Transp., Inc. v. Arkansas-Best Freight Sys. Inc., 419 U.S. 281, 286, 95 S.Ct. 438, 442, 42 L.Ed.2d 447 (1974)). Here, it is clear from PSC‘s two orders that it relied, in part, on preemption principles in dismissing petitioner‘s complaint. See supra note 4. The PSC‘s position that its action is precluded by the governing federal statute and regulations and that the appropriate forum “as Congress intended [is] GSA, SBA or the federal courts” also permeates its brief in this court. In summarizing its arguments on review, the Commission stated the following which exemplifies its legal position:However, the Commission is distressed by the apparent lack of diligence shown by GSA in pursuing PEPCO‘s failure to submit an acceptable plan within a reasonable time period. This inaction served only to encourage recalcitrant behavior and fuel allegations of bad faith, however erroneous. This adds credence to the ongoing suggestions that GSA‘s approval of the plan has been almost perfunctory. Notwithstanding the result we reach today, the Commission notes its extreme dissatisfaction with the manner in which PEPCO has conducted itself, such conduct necessitating the commencement of this proceeding. It is obvious that if a complaint had not bеen filed, PEPCO would not have complied with the federal statute. Notwithstanding PEPCO‘s protestations, its failure to resolve its disagreement with GSA gives credence to allegations of bad faith. Moreover, it is interesting to note that no challenge to GSA‘s requirements was mounted by PEPCO in any forum despite its insistence that PEPCO was not covered by the Small Business Act requirements. (Emphasis in original).
Such reasons for sustaining the validity of the PSC‘s order fall within the preemption principles discussed in this dissenting opinion. Therefore, in my view, the PSC‘s preemption determination is sufficiently articulated in such language in its orders and brief to allow this court to review whether the PSC erred in concluding as a matter of law that federal law precludes it from intruding into an area which by statute is vested in certain federal agencies or in the federal courts.The Commission‘s decision to dismiss the action must be upheld because: 1) only GSA, not the Commission, has statutory authority to determine whether the Small Business Act has been violated and no such determination was ever made, 2) GSA, not the Commission, has the authority over the federаl procurement process, and 3) a remand of this matter would lead us to the same result because the Commission lacks authority in this area.