Constitutional Limits on "Contracting Out" Department of Justice Functions under OMB Circular A-76

• Court: Department of Justice Office of Legal Counsel
• Decided: April 27, 1990
• Status: Published

Opinion

Constitutional Limits on “Contracting Out” Department of Justice Functions under OMB Circular A-76

L itig a tio n o n b e h a l f o f th e U nited S ta te s m u st be c o n d u c te d o r c lo s e ly s u p e rv is e d by o ffic e rs o f th e U n ite d S ta te s w h o have b een a p p o in te d in c o n fo rm ity w ith th e A p p o in tm e n ts C la u s e an d w h o a re u n d e r th e s u p erv isio n o f th e A tto rn e y G e n e r a l a n d th e P r e s id e n t.’

C e r ta in p ro g r a m a n a ly s t, p ro g ram m o n ito r a n d h is to ric a l re s e a rc h su p p o rt p o s itio n s in th e D e ­ p a r tm e n t o f J u s tic e d o n o t in v o lv e g o v e rn m e n ta l a u th o rity th a t can o n ly b e e x e rc is e d by o ff ic e rs o f th e U n ite d S tates, but in s te a d in v o lv e in fo rm a tio n g a th e rin g a n d re p o rtin g d u tie s w h ic h m a y c o n s titu tio n a lly be p e rfo r m e d by p riv a te p a rtie s o n a c o n tra c t b a sis .

April 27, 1990

M e m o r a n d u m O p in io n f o r t h e G e n e r a l C o u n s e l J u s t ic e M a n a g e m e n t D iv is io n

You have asked for our advice concerning the constitutional limitations on employing private contractors or individuals to perform certain tasks now performed by Department of Justice employees. First, you have asked us to explore any constitutional questions raised by the contracting out of forty- eight program analyst and program manager positions responsible for grant activities in the Office of Juvenile Justice and Delinquency Prevention (“O JJDP”) and the Bureau of Justice Assistance (“BJA”). According to the D epartm ent’s notice in the January 8, 1990 Commerce Business Daily, the functions performed by these positions include, but are not limited to, the following:

First, the development, monitoring, and promotion of criminal justice (including drug prevention), juvenile justice and delin­ quency prevention, and related programs administered by State and local government agencies and other public and nonprofit

* E d ito r's n o te: T h e O ffice o f Legal C o u n se l has d isav o w e d the interpretation o f the A ppointm ents C la u se s e t fo rth in th is o p in io n . See M em o ran d u m for th e G eneral C ounsels o f the Federal G o v e rn ­ m en t, fro m W alter D ellin g er, A ssistant A tto rn e y G eneral, Re: The Constitutional Separation o f Powers betw een the President and Congress, at 2 0-21 n.53 (M ay 7, 1996).

94 organizations and institutions. (Congress sets certain require­ ments which these agencies must meet to qualify for federal assistance.) Second, the provision of technical assistance to State/local agencies in the form of short-term training on tech­ nical matters; dissemination of information (publications, institutes, conferences, seminars, etc.); provision of information to develop programs proposals; and preparation of program plans.

The notice also indicates that as a general matter, personnel holding these positions are “responsible for administering the Federal part of the state or local government’s criminal justice or related programs.” It is our under­ standing that employees in these positions presently monitor the programs of state and nonprofit grantees and report on their compliance with federal law and grant specifications. While these reports may form the basis for federal funding decisions made by the Administrator of OJJDP or the Direc­ tor of BJA, no final decisions concerning program compliance or federal funding can be made by any of the forty-eight employees who presently occupy these positions. In addition, some of these employees may assist in the formation of program initiatives within the framework of overall policy goals set by the Administrator or the Director. Finally, some of these posi­ tions involve rendering non-binding advice to grantees concerning compliance with federal law. However, all final decisions as to actual compliance with federal law rest with the Administrator and the Director. Second, you have asked our opinion concerning the contracting out of historical research support positions in the Office of Special Investigations (“OSI”) of the Criminal Division. The work contracted out in this context would involve translation, research, and secretarial support services for OSI historians investigating individuals suspected of having committed war crimes during World War II. Finally, you have expressed the need for more general guidance concern­ ing the constitutional limitations on the application of OMB Circular A-76 to Department of Justice functions.1 In particular, you have inquired whether we adhere to the views expressed in an opinion issued by this Office in 1983 that concludes that legislation providing for the use of private counsel to represent the United States in debt collection actions is constitutionally prob­ lematic. See Memorandum to Deputy Attorney General Schmults, from Assistant Attorney General Olson, Office of Legal Counsel (May 20, 1983). ' It ap p ears to us that, absent presidential d irectiv es to the contrary, the A ttorney G eneral, as the h e ad o f the D ep artm en t o f Justice and the P resid en t's c h ie f legal advisor, has the final a u th o rity to d e te rm in e w hat po sitio n s w ithin the D epartm ent o f Justice are suitable to be co nsidered fo r c o n tractin g o ut. See S U .S .C . § 301 (“T h e h ead o f an E xecutive d e p a rtm e n t. . . m ay p rescribe re gulations fo r the g o v e rn m e n t o f h is d ep artm en t, the co n du ct o f its em ployees, the distrib u tio n and perform ance o f its b u sin ess, and the custody, use, and preservation o f its records, p apers, and p ro p erty.” ); see also Olympic Fed. Sav. & Loan A ss'n v. Office o f Thrift Supervision, T i l F. Supp. 1183, 1197 (D .D .C . 1990) (‘‘[T ]he A tto rn ey G en eral is charged w ith responsibility fo r en suring that only law fully appointed officials act on b e h a lf o f the U n ited S tates, an d c o n seq u en tly his in terp retatio n o f law on this subject is e n title d to g reat d e fe re n c e .” ).

95 II. Analysis

The Constitution provides that “[t]he executive Power shall be vested in a President o f the United States of America,” and charges the President to “take Care that the Laws be faithfully executed.” U.S. Const, art II, § 1, cl. 1; art. II, § 3. The very core of the executive power is the authority to pursue civil and criminal enforcement actions on behalf of the United States. See Buckley v. Valeo, 424 U.S. 1, 138 (1976) (per curiam) (“A lawsuit is the ultim ate remedy for a breach o f the law, and it is to the President . . . that the Constitution entrusts the responsibility to ‘take Care that the Laws be faithfully executed.’”); Morrison v. Olson, 487 U.S. 654, 691 (1988) (“no real dispute that the functions performed by the independent counsel are ‘executive’”); Springer v. Philippine Islands, 277 U.S. 189, 202 (1928) (au­ thority to enforce the laws and to appoint agents to do so are executive functions); M yers v. United States, 272 U.S. 52 (1926) (same). More gener­ ally, the executive power encompasses the interpretation and effectuation of all public law. Bowsher v. Synar , 478 U.S. 714, 733 (1986) (“Interpreting a law enacted by Congress to implement the legislative mandate is the very essence o f ‘execution’ of the law.”). Obviously, the President alone cannot assure the faithful execution of the laws, and the Appointments Clause provides the constitutional mechanism for the delegation of the executive power to a corps of federal officers under the President’s control to assist him in executing the laws. See M yers, 272 U.S. at 133 (“Each head of a department is and must be the President’s alter ego in the matters of that department where the President is required by law to exercise authority.”); see a lso In re Neagle, 135 U.S. 1, 63 (1890) (“The Constitution, section 3, Article 2, declares that the President ‘shall take care that the laws be faithfully executed,’ and he is provided with the means of fulfilling this obligation by his authority to commission all the officers of the United States, and, by and with the advice and consent of the Senate, to appoint the most important o f them and to fill vacancies.”). The Appointments Clause has both a “horizontal” and a “vertical” role to play in the separation of powers. Horizontally, it assures that executive power is not exercised by individuals appointed by, or subservient to, an­ other branch o f government. Vertically, the clause protects against the delegation of federal executive authority to private entities outside the con­ stitutional framework.2

2 T h e “ v e rtic a l” p ro te c tio n s o f the A p p o in tm en ts C lau se un d ergird the “horizo n tal" separation o f pow ­ e rs. I f th e fe d e ra l e x ec u tiv e , legislative, a n d ju d ic ia l po w ers could be granted to priv ate e n titie s to be w ie ld e d o u ts id e o f c o n stitu tio n a l strictu res, the carefu l sep aration and interm ingling o f pow ers in the C o n stitu tio n its e lf w o u ld be rendered a p a p e r g esture. Cf. Northern Pipeline Constr. Co. v. M arathon P ipeline Co., 4 5 8 U .S . 5 0 (1 9 8 2 ) (holding u n co n stitu tio n al d e leg ation o f A rticle III duties to ju d g e s not a p p o in te d in c o n fo rm ity w ith the A p p o in tm en ts C la u se ); A .L A . Schechter Poultry Corp. v. United States, 295 U .S . 495 (1 9 3 5 ) (federal le g islativ e p o w er m ay not be d elegated to p rivate parties). In ad d itio n , th e “ v ertical” o r “nondelegation” aspect o f the A ppointm ents C lause ensures that the President, th ro u g h a u n itary e x ecu tiv e branch, can b e held politically accountable for his execution o f the law s.

96 The Appointments Clause, Article II, Section 2, Clause 2, provides that:

[The President] shall nominate, and by and with the Advice and Consent of the Senate, shall appoint Ambassadors, other public Ministers and Consuls, Judges of the supreme Court, and all other Officers of the United States, whose Appoint­ ments are not herein otherwise provided for, and which shall be established by Law; but the Congress may by Law vest the Appointment of such inferior Officers, as they think proper, in the President alone, in the Courts of Law, or in the Head of Departments.

In Buckley v. Valeo, 424 U.S. 1 (1976) (per curiam), the Supreme Court examined the reach and requirements of the Appointments Clause in the context of a constitutional challenge to the composition of, and authority wielded by, the Federal Election Commission. The Commission was com ­ posed o f six voting members. The President pro tempore of the Senate, the Speaker of the House, and the President each appointed two of the voting members. None of the voting members of the Commission was nominated by the President and confirmed by the Senate in accordance with the Ap­ pointments Clause. By statute the Commission was charged with what the Supreme Court viewed as three distinct types of tasks. First, the Commission was to gather, organize, and make available to the public data concerning campaign spend­ ing and the administration of elections. The Court characterized these as “recordkeeping, disclosure, and investigative functions.” Id. at 110. Sec­ ond, the Com m ission was granted extensive power to issue binding administrative rules, to “formulate general policy” concerning the enforce­ ment of applicable statutes, and to issue advisory opinions concerning election law requirements. Id. at 110-11. Finally, the Commission was granted what the Court characterized as “direct and wide ranging” enforcement powers. Id. at 111. The Commission was authorized to institute civil actions to enforce statutory requirements, to sue for the return of campaign “matching funds” to the United States Treasury, and to issue “findings” of failure to file expenditure reports. Id. The Court began its analysis by rejecting the notion that the locution “Officers of the United States” in the Appointments Clause was merely a creature of “etiquette or protocol.” Instead, the Court viewed the term as a reference to those persons who may exercise “significant authority” under the laws of the United States. The Court stated:

We think that the term “Officers of the United States” as used in Art. II, defined to include “all persons who can be said to hold an office under the government” in United States v.

97 G erm aine, [99 U.S. 508 (1879)], is a term intended to have substantive meaning. We think its fair import is that any ap­ pointee exercising significant authority pursuant to the laws o f the United States is an “Officer of the United States,” and must, therefore, be appointed in the manner prescribed by § 2, cl. 2 of that Article.

Id. at 125-26.

W hile the Buckley Court did not offer a comprehensive definition of what constitutes “significant authority” for purposes of the Appointments Clause, the C ourt’s treatment of the various powers and duties conferred upon the Federal Election Commission offers significant guideposts. First, the Court made clear that “vesting in the Commission primary responsibility for con­ ducting civil litigation in the courts of the United States for vindicating public rights, violate[s] Art. II, § 2, cl. 2, of the Constitution.” Id. at 140. The Court indicated that “[s]uch functions may be discharged only by per­ sons who are ‘Officers of the United States’ within the language of that section.” Id. The Court also held that the Commission’s “broad administrative powers: rulemaking, advisory opinions, and determinations of eligibility for funds and even for federal elective office itself,” constituted “significant authority” that could only be executed by properly appointed officers of the United States. Id. at 140, 141-42. The Court indicated that “each of these functions also represents the performance of a significant governmental duty exercised pursuant to a public law.” Id. at 141.3 Finally, the Court held that the Commission, as then constituted, could exercise powers of “an investigative and informative nature, falling in the same general category as those powers which Congress might delegate to one o f its own committees.” Id. at 137. These information gathering duties were, in the Court’s view, “sufficiently removed from the administration and enforcement of the public law as to permit their being performed by persons not ‘Officers of the United States.’” Id. at 139.4

1 It sh o u ld b e no ted th at the "advisory” o p in io n s o f the Federal E lection C om m ission w ere so in nam e o n ly . T h e sta tu te p ro v id e d th at any in d iv id u a l w ho a c te d in good fa ith on the b a sis o f such an opinion “ s h all b e p re su m ed to be in com pliance” w ith federal e le ctio n law “ n o tw ithstanding any o th e r provision o f law .” Buckley, 4 2 4 U .S . at 110-11. J T h e c o n stitu tio n a l c o n c e rn s ex p ressed by th e B uckley C o u rt are th e m selv e s re fle c te d in O M B C ir­ c u la r A -7 6 . T h e C irc u la r recognizes th a t ‘‘[c je rta in fu n c tio n s are in h e re n tly G o v e rn m e n ta l in n a tu re ," d e fin e d as fu n c tio n s “ w h ic h require e ith e r the ex ercise o f d iscretio n in a p p ly in g G o v e rn m e n t a u th o rity o r th e u se o f v a lu e ju d g m e n t in m aking d e c isio n s fo r the G o v e rn m e n t.” O M B C irc u la r N o. A -76 §§ 5b, 6 e (R ev . A u g . 4 , 1983). Listed e x am p les include “c rim in a l in v e stig atio n s, p ro se cu tio n s and o th e r ju d ic ia l fu n c tio n s ; m a n a g em e n t o f G o v e rn m e n t p ro g ram s re q u irin g v alue ju d g m e n ts ,” and “ sele c tio n o f p ro g ra m p rio ritie s ." Id. § 6 e (l). T h e C irc u la r in d ic a te s th at it is the policy o f the U n ited S ta te s to “ [r]e ta in G o v e rn m e n ta l [f u n c tio n s [i]n -h o u s e ,” and th a t th ese fu n c tio n s “sh all be p erfo rm ed by G o v ­ e rn m e n t e m p lo y e e s .” Id. § 5(b).

98 Buckley thus makes it clear that the exercise of rulemaking or policymaking functions requires proper authority under the Appointments Clause. See also Olympic Fed. Sav. & Loan A s s ’n. v. Office o f Thrift Supervision, 732 F. Supp. 1183 (D.D.C. 1990) (Director of the Office of Thrift Supervision exer­ cises significant rulemaking and regulatory authority and thus under Buckley must be appointed in accordance with the Appointments Clause). On the other hand, information gathering, investigative, and advisory functions that do not involve final actions affecting third party rights may be performed by private parties or “independent” contractors. Similarly, purely ministerial and internal functions, such as building security, mail operations, and physi­ cal plant maintenance, which neither affect the legal rights of third parties outside the Government nor involve the exercise of significant policymaking au­ thority may be performed by persons who are not federal officers or employees. Applying these criteria to the two types of functions at issue here, we conclude that both the forty-eight program analyst and program monitor positions and the historical research support positions do not involve the exercise of “significant authority pursuant to the laws of the United States,” as that phrase is used in Buckley. We emphasize that under Buckley private individuals may not determine the policy of the United States, or interpret and apply federal law in any way that binds the United States or affects the legal rights of third parties. Nor can any private individuals make funding decisions. See Letter for Marshall J. Breger, Chairman of the Administrative Conference of the United States, from Deputy Attorney General Bums at 4 (Nov. 10, 1986) (“Bums Letter”) (“[W]e do not believe that individuals who are not officers of the government may commit or dispose of the property of the United States.”). Properly appointed federal officials must maintain both legal and effective control over the direction of United States policy in this area as well as control over the allocation of federal funds. As we understand it, however, the program analysts and monitors in­ volved here simply study and make recom m endations concerning the compliance of various state and local programs with federal funding require­ ments. While the employees who presently occupy these positions may advise and assist in policy formation, they cannot determine the final policy of the Department of Justice. Nor can these employees take any indepen­ dent action on behalf of the United States affecting the rights o f grantees. The prior opinions of this Office indicate that such “study and report” func­ tions need not be performed by officers of the United States within the meaning of the Appointments Clause. See, e.g., Memorandum for the Attor­ ney General, from Theodore B. Olson, Assistant Attorney General, Office of Legal Counsel, Re: Enrolled Bill S. 118, “To Provide fo r the Establishment o f a Commission on the Bicentennial o f the Constitution’’ (Sept. 29, 1983) (Commission on the Bicentennial of the Constitution); Memorandum for Robert A. McConnell, Assistant Attorney General, Office of Legal Affairs, from Ralph W. Tarr, Deputy Assistant Attorney General, Office of Legal

99 Counsel, Re: Enrolled Bill H R. 1900 (Apr. 6, 1983).5 We also conclude that under Buckley, the duties of the historical research support positions may be performed by private persons. As a general matter, the investigation of criminal activity is an inherently governmental function performed exclusively by federal officers within the executive branch. Thus, we have no doubt that the authority to seek and execute search warrants, or to make arrests in the name o f the United States is “significant authority” under Buckley. However, as w e understand it, the historical research support personnel at issue here conduct background research and translation under the direction o f the OSI historians who are properly appointed federal offic­ ers. These support personnel have no authority to take or authorize any legal action on behalf of the United States. Rather, they are simply charged with library research, translation, and collation of data. The functions to be performed by these individuals are more akin to those of an expert witness or consultant than they are to those of an FBI agent or a federal prosecutor. Such purely informational tasks may be performed by private individuals. See Memorandum for Richard C. Stiener, Chief, United States National Cen­ tral Bureau, INTERPOL, from Larry Simms, Deputy Assistant Attorney General, Office of Legal Counsel, Re: Establishment o f an Interpol Subbureau in Puerto Rico (Jan. 19, 1984) (information gathering and sharing functions o f United States National Central Bureau of INTERPOL may be performed by persons not officers of the United States); id. at 12 n .ll (noting that “ [e]ven private citizens can be an important source of information in the cause o f law enforcement”). As a general matter, we also reaffirm the consistent position of this Of­ fice and the Department of Justice that the authority to direct litigation on behalf of the United States may not be vested in persons who are not offic­ ers of the United States appointed in the proper manner under Article II, Section 2, Clause 2 o f the Constitution. See, e.g., Brief for the United States as Amicus Curiae Supporting Appellees at 17, Morrison v. Olson, 487 U.S. 654 (1988) (No. 87-1279) (“[T]he duty of the President to ‘take Care’ means that he, with the help of the Senate in certain cases and acting on his own or through his heads of departments in others, is responsible and accountable to the people for selecting those persons who will exercise significant au­ thority in executing the law.”); Bums Letter at 2 (“[A]ny broad delegation of authority to private persons to conduct litigation in the name of the United States is likely to raise constitutional problems.”). This position is dictated both by the Supreme C ourt’s decision in Buckley and by the broader separation of powers concerns underlying the Supreme C ourt’s Appointments Clause jurisprudence. See Buckley, 424 U.S. at 139 (“ [A]ll such suits [civil and criminal], so far as the interests of the United

5 It is q u ite p o s sib le th a t O M B C ircu lar A -7 6 ’s d e fin itio n o f in h e re n tly g o v e rn m e n ta l fu n c tio n s c o v ­ ers a w id e r ran g e o f fu n c tio n s than those th a t entail the e x e rc ise o f “sig n iftean t a u th o rity ” u n d e r Buckley. T h is o p in io n d o e s n o t a d d re ss that issue.

100 States are concerned, are subject to the direction, and within the control of, the Attorney-General.”) (quoting The Confiscation Cases, 74 U.S. (7 Wall.) 454, 458-59 (1869)); see also United States v. San Jacinto Tin Co., 125 U.S. 273, 279 (1888) (the Attorney General “is undoubtedly the officer who has charge of the institution and conduct of the pleas of the United States, and of the litigation which is necessary to establish the rights of the govern­ ment”).6 Thus, both the Appointments Clause and more general separation of powers concerns make it clear that the vesting of independent litigation authority in persons who are not federal officers or employees and who are not subject to executive branch discipline and control is unconstitutional. Were this not so, Congress could displace particular litigation authority from the executive branch and vest it in a private interest group or even in the House or Senate Counsel. We note that the Department’s support for the Debt Collection Act Amend­ ments o f 1986, Pub. L. No. 99-578, 100 Stat. 3305 (codified at 31 U.S.C. § 3718(b)), is fully consistent with this position. Those amendments autho­ rized the Attorney General to retain private counsel to assist in the collection of non-tax debts owed to the United States. In signing that legislation into law. President Reagan stated:

I am approving [the debt collection amendments] knowing that the Attorney General will take all steps necessary to en­ sure that any contact entered into with private counsel contains provisions requiring ongoing supervision of the private coun­ sel so that all fundamental decisions, including whether to initiate litigation and whether to settle or compromise a claim, are executed by an officer of the United States, as required by the Constitution.

Pub. Papers of Ronald Reagan 1454 (1986).

The Department has issued regulations requiring the designation of “an Assistant U.S. Attorney to serve as the Contracting Officer’s Technical Rep­ resentative (“COTR”) on the contracts with private debt collection lawyers

4 We n o te that apart from the constitutional c o n strain ts exam ined in Buckley there is stro n g su pport in the statutes o rganizing the litigation authority o f the ex ecu tiv e branch fo r the p ro p o sitio n that on ly o fficers o f the U n ited S tates m ay conduct litig atio n in the nam e o f the U n ited States. S e c tio n 3106 o f title 5 pro v id es that, in g en eral, agency and dep artm en t heads “ m ay not em p lo y an atto rn e y o r co u n sel for the co n d u ct o f litigation in w hich the U nited States . . . is a party, o r is interested, o r fo r the secu rin g o f e vidence therefor, but shall refer the m atter to the D ep artm en t o f Justice.” W ithin the D e p artm e n t o f Ju stic e itself, statu to ry stru ctu re reflects c o n stitu tio n al design. A ll litigation m ust b e c o n d u cted by officers u n d e r th e control and supervision o f the A tto rn ey G eneral. See, e.g., 28 U .S.C . § 5 1 5 (b ) (“ E ach a ttorney sp ec ia lly retained un d er the authority o f the D epartm ent o f Justice shall be co m m issio n ed as a special a ssistan t to the A ttorney G eneral o r special attorney, an d shall take the oath re q u ire d by law .” ); 28 U .S .C . § 516 ( “ [T ]he conduct o f litig atio n in w hich the U nited States . . . is a party . . . is reserved to officers o f the D ep artm en t o f Justice, un d er the d irectio n o f the A ttorney G e n eral.” ); see also 28 U .S .C . §§ 519, 547.

101 in their respective districts.” 28 C.F.R. § 11.2 (1989). Under the regulations, these COTRs “will be responsible for assisting the contracting officer by supervising the work of the private counsel in their respective districts and providing necessary approvals with respect to the initiation or settlement of lawsuits or similar matters.” Id. In addition, the Department’s Request for Proposals (“RFP”), issued pursuant to the debt collection amendments, makes it clear that the COTR must review all major pleadings in debt collection actions before they are filed by the private attorney. The Department has indicated that it considers this kind of close supervision of private attorneys “necessary to meet constitutional .concerns and preserve the authority of the Attorney General over litigation.” Bums Letter at 3.

Conclusion

In sum, we reaffirm the longstanding position o f this Office and the De­ partment that litigation on behalf of the United States must be conducted or closely supervised by properly appointed officers of the United States, offic­ ers who are themselves under the supervision of the Attorney General and the President. In addition, any significant policymaking duties under federal law or discretionary acts which affect the rights of citizens cannot be under­ taken by private parties. On the other hand, advisory and information gathering functions, as well as purely ministerial and internal management matters, need not be performed by officers of the United States. We therefore con­ clude that the forty-eight program analyst and program monitor positions and the historical research support positions do not involve governmental author­ ity that can only be exercised by officers, but instead involve information gathering and reporting duties which may constitutionally be performed by private parties on a contract basis.

WILLIAM P. BARR Assistant Attorney General Office o f Legal Counsel