UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA
) CLARICE FELDMAN, ) ) Plaintiff, ) ) v. ) No. 15-cv-1967 (KBJ) ) MURIEL E. BOWSER, in her official ) capacity as Mayor of the District of ) Columbia, et al., ) ) Defendants. ) )
MEMORANDUM OPINION
The Local Budget Autonomy Amendment Act of 2012 (“the Budget Autonomy
Act”), D.C. Law 19-321, 60 D.C. Reg. 1724 (Feb. 15, 2013), represents the culmination
of decades of effort on the part of the government of the District of Columbia (the
“District”) to obtain greater budget autonomy by limiting the degree of congressional
oversight over the manner in which the District enacts its annual budget and spends
local tax and fee revenues. In the instant action, Plaintiff Clarice Feldman claims that
the Budget Autonomy Act improperly circumvents congressionally-mandated budget
procedures, because it authorizes the District to adopt and implement a “local” spending
plan as part of the municipality’s annual budget without submitting that portion of the
budget to the President and Congress for approval. (See Compl., ECF No. 1, ¶¶ 12–24
(comparing the budgeting procedures that the Budget Autonomy Act prescribes with the
congressionally-mandated procedures of the Home Rule Act, D.C. Code §§ 1-201.01 et
seq.); id. ¶¶ 41–42 (alleging that the Budget Autonomy Act violates the procedures prescribed in the Home Rule Act).) By virtue of her status as a District of Columbia
taxpayer, Feldman contends that she has Article III standing to file a federal lawsuit
that challenges the Budget Autonomy Act and each of the annual fiscal year (“FY”)
budgets that the District has enacted pursuant to that Act from 2016 to the present.
Feldman’s one-count complaint requests a declaration that the Budget Autonomy Act
and the local portion of the District’s annual budgets are unlawful, and seeks an
injunction that prevents defendants Muriel Bowser (in her official capacity as the
District’s Mayor) and Jeffrey DeWitt (in his official capacity as the District’s Chief
Financial Officer) (collectively, “Defendants”) from incurring further obligations or
making further expenditures of local taxpayer funds on those portions of the District’s
annual budget. (See id. at 9.) 1
Before this Court at present are the two motions to dismiss the complaint that
Defendants have filed in this action. (See Def. DeWitt’s Mot. to Dismiss (“DeWitt’s
Mot.”), ECF No. 9; Def. Bowser’s Mot. to Dismiss (“Bowser’s Mot.”), ECF No. 10.) 2
As relevant here, both motions raise threshold challenges to Feldman’s standing to
bring this action. For the reasons explained below, this Court agrees with Defendants
that Feldman does not have standing to challenge the legality of the Budget Autonomy
Act or the method by which the District allocates its funds to be expended for
1 Page-number citations to the documents that the parties have filed refer to the page numbers that the Court’s electronic filing system automatically assigns. 2 The instant case was reassigned to this Court on July 15, 2016, after which the Court ordered the parties to file corrected briefs that conform with this Court’s General Order and Guidelines for Civil Cases. (See Min. Order of July 21, 2016; see also General Order & Guidelines, ECF No. 26.) In this Memorandum Opinion, the relevant page-number citations to DeWitt’s motion to dismiss and Feldman’s opposition brief refer to these corrected filings. (See Notice, ECF No. 27 (attaching DeWitt’s corrected motion to dismiss); Pl.’s Notice of Modified Br., ECF No. 28 (attaching Feldman’s corrected opposition brief).)
2 otherwise-lawful purposes. Accordingly, this Court concludes that it has no subject-
matter jurisdiction to entertain Feldman’s complaint, and thus, Defendants’ motions to
dismiss the complaint must be GRANTED. A separate Order consistent with this
Memorandum Opinion will follow.
I. BACKGROUND
A. The Home Rule Act And The Budget Autonomy Act
Before the early 1970s, the Council of the District of Columbia did not exist, and
the United States Congress “prepared and approved, in an appropriations act, a budget
for the District” each year. James W. Moeller, Congressional Management of the
District of Columbia Prior to Home Rule: The Struggle to Underground Power Lines in
the Nation’s Capital, 19 UDC L. Rev. 115, 116–17 (2016). Congress enacted the Home
Rule Act in 1973, as a compromise between continued congressional oversight and
District autonomy. The Home Rule Act granted “the people of the District of Columbia
an opportunity in exercising their rights once more and yet with adequate safeguards for
the Federal interest component.” Council of the Dist. of Columbia v. Gray, 42 F. Supp.
3d 134, 139 (D.D.C. 2014), vacated and remanded sub nom. Council of the Dist. of
Columbia v. Bowser, No. 14-7067, 2015 WL 3450417 (D.C. Cir. May 27, 2015)
(internal quotation marks and citation omitted). As an initial matter, the Home Rule
Act established the Council as the District’s legislative branch. See D.C. Code § 1-
204.01. 3 Moreover, Title IV of the Home Rule Act set forth the District’s Charter,
which “establish[es] the means of governance of the District[,]” id. § 1-203.01, and thus
3 See also Council for the Dist. of Columbia, D.C. Home Rule, http://dccouncil.us/pages/dc-home-rule (last visited May 30, 2018).
3 essentially “serve[s] as a constitution[,]” Jackson v. Dist. of Columbia Bd. of Elections
& Ethics, 999 A.2d 89, 123 (D.C. 2010). And just as with a state constitution, the
District’s Council can amend the Charter pursuant to a process set forth in the Home
Rule Act. See D.C. Code § 1-203.03(a).
Significantly for present purposes, the Home Rule Act also authorized the
District’s Council to adopt an annual budget (including both locally-derived and federal
funds), which the Mayor submitted to the President of the United States, who then
forwarded that budget request to Congress for review as part of the national budget.
See id. § 1-204.46 (2006); see also Gray, 42 F. Supp. 3d at 140. Notably, the Home
Rule Act made clear that the budget that the District so proposed could not be put into
effect, nor could any monies be obligated or expended pursuant to that budget, “unless
such amount [was first affirmatively] approved by Act of Congress, and then only
according to such Act.” D.C. Code § 1-204.46 (2006).
In 2012, the District’s Council undertook to amend the procedures that the Home
Rule Act established with respect to the District’s budget-implementing process. The
Council unanimously passed a legislative proposal—the Budget Autonomy Act—which
the District of Columbia’s residents subsequently voted to ratify, and Congress
ultimately let stand without expressing its disapproval. See Gray, 42 F. Supp. 3d at
142. (See also Bowser’s Mot. at 15.) As enacted, the Budget Autonomy Act altered the
Home Rule Act by removing the federal government from the budget-formulation and
appropriation process for most District funds. Specifically, the Budget Autonomy Act
bifurcated the District’s annual budget into a “local” portion consisting of locally-
derived funds (e.g., funds raised from local taxes imposed on District residents), and a
4 federal portion consisting of federally-derived funds (e.g., funds provided by Congress)
(see Bowser’s Mot. at 14), and as to the local portion, removed the President from the
review process entirely, providing that, rather than having the Mayor submit the entire
budget to the President to be presented to Congress, “[t]he local portion of the annual
budget shall be submitted by the Chairman of the Council to the Speaker of the House
of Representatives[,]” Budget Autonomy Act § 2(e). In addition, the Budget Autonomy
Act established that Congress’s review of the local portion of the District’s proposed
budget would be passive, rather than active. (See Bowser’s Mot. at 14–15.) Thus,
rather than requiring Congress to enact affirmative legislation approving the District’s
annual budget—as had been the process under the pre-amendment Home Rule Act—the
Budget Autonomy Act permitted the local portion of the District’s budget to take effect
if, after a thirty-day review period, Congress did not pass a joint resolution
disapproving of the District’s spending plan. (See id.)
B. Challenges To The Budget Autonomy Act
Several months after the July 2013 enactment of the Budget Autonomy Act, then-
District of Columbia Attorney General Irvin Nathan formally advised then-Mayor
Vincent Gray that he should not implement the Act, and should “advise Executive
Branch officials and employees not to do so absent a binding judicial decision to the
contrary.” Gray, 42 F. Supp. 3d at 142 (internal quotation marks and citation omitted).
In April of 2014, based on the Attorney General’s recommendation, Gray and
Defendant DeWitt (the District’s Chief Financial Officer) advised the Council (1) that
they believed the Act violated the Home Rule Act, the District’s Charter, and other
federal laws, (2) that any fiscal year budget had to be enacted pursuant to the pre-
amendment provisions of the Home Rule Act, and (3) that, on Mayor Gray’s watch, no
5 expenditures would be authorized pursuant to a budget that was enacted in accordance
with the Budget Autonomy Act. See id. at 143. The Council disagreed with this
assessment, and in response, sued Mayor Gray in D.C. Superior Court, seeking a
declaration that the Budget Autonomy Act is valid and enforceable, and also an
injunction requiring Gray and DeWitt to adhere to the Act’s provisions. (See Compl.
for Declaratory and Injunctive Relief, Council of the Dist. of Columbia v. Gray, No.
2014-CA-2371-B (Apr. 17, 2014).) That action was removed to this federal district,
and on May 19, 2014, the Court (Sullivan, J.) ruled that the Budget Autonomy Act
violated the Home Rule Act and the Anti-Deficiency Act, 31 U.S.C. § 1341, because,
among other things, it exceeds the Home Rule Act’s limits on the District’s ability to
alter the federal government’s role in the District’s budget. See Gray, 42 F. Supp. 3d at
138, 146.
The Council appealed the District Court’s decision to the D.C. Circuit. See
Bowser, 2015 WL 3450417, at *1. However, while that appeal was pending,
Councilwoman Muriel Bowser was elected as the District’s Mayor. (See Bowser’s Mot.
at 15–16.) Bowser supported the Budget Autonomy Act and intended to enforce it, and
she therefore moved to dismiss the Council’s appeal and vacate the District Court’s
judgment on grounds that the Mayor’s office had changed its position in a manner that
rendered the Council’s legal claims moot. (See id. at 16.) The D.C. Circuit granted
Bowser’s request without explanation, and vacated the District Court’s opinion with
instructions to remand the case back to Superior Court. See Bowser, 2015 WL
3450417, at *1.
6 On remand, the parties were the Council and Bowser in support of the Budget
Autonomy Act, and DeWitt still in opposition. On March 18, 2016, the Superior Court
ruled that, in its opinion, the Budget Autonomy Act was lawful. (See Omnibus Order,
Council of the Dist. of Columbia v. DeWitt, No. 2014-CA-2371-B (Mar. 18, 2016).)
According to the Superior Court, the Act was a valid exercise of the District’s authority
to amend the Home Rule Act and the District’s Charter largely because, by enacting the
Home Rule Act, Congress had intended to delegate sweeping legislative authority to the
District; because no provision of the Home Rule Act or the Anti-Deficiency Act
preempted the Budget Autonomy Act; and because any ambiguities in the Home Rule
Act had to be resolved the District’s favor. (See id. at 16–37.) DeWitt did not appeal
the Superior Court’s decision.
C. Procedural History
Feldman filed the instant complaint on November 6, 2015, while the Council,
Bowser, and DeWitt were still litigating the Budget Autonomy Act’s legality in
Superior Court. (See generally Compl.) Feldman alleges that “[t]he Budget Autonomy
Act violates the Home Rule Act[,]” and that, “[b]y complying with the Budget
Autonomy Act,” the District is “incur[ring] illegal, unlawful, and ultra vires obligations
of local taxpayer funds[,]” and “mak[ing] illegal, unlawful, and ultra vires expenditures
of local taxpayer funds.” (Id. ¶¶ 41–42.) Feldman appears to allege that section 446 is
the specific provision of the Home Rule Act that the Budget Autonomy Act violates
(see id. ¶¶ 17–19); pre-amendment, that section provided that “no amount may be
obligated or expended by any officer or employee of the District of Columbia
government unless such amount has been approved by Act of Congress, and then only
7 according to such Act.” D.C. Code § 1-204.46 (2006). Feldman also argues (in her
brief in opposition to Defendants’ motions to dismiss) that “every dollar currently being
spent is in violation of the Antideficiency Act[.]” (Pl.’s Opp’n to Defs.’ Mots. to
Dismiss (“Pl.’s Opp’n”), ECF No. 15, at 6.) The Anti-Deficiency Act prohibits, inter
alia, “[a]n officer or employee . . . of the District of Columbia government” from
“mak[ing] or authoriz[ing] an expenditure or obligation exceeding an amount available
in an appropriation or fund for the expenditure or obligation[.]” 31 U.S.C.
§ 1341(a)(1)(A). “No private right of action for declaratory, mandatory[,] or injunctive
relief exists under” the Anti-Deficiency Act. Thurston v. United States, 696 F. Supp.
680, 683 (D.D.C. 1988).
And while the complaint on its face challenges only the District’s FY 2016
budget, Feldman has since clarified that her claims concern the budgets for 2016, 2017,
and 2018. (See Tr. of Mot. Hr’g (Oct. 3, 2017) (“Hr’g Tr.”), ECF No. 34, at 6:7–9
(“We’re focused [on] every year since . . . 2016, [including] 2016, 2017[,] and now
2018, [which is] each budget . . . purportedly [passed] pursuant to the [L]ocal Budget
Autonomy Act.”); Pl.’s Not. of Dist. of Columbia’s FY 2018 Budget Process, ECF No.
31, at 2 (requesting leave “to amend [the] Complaint to allege the forthcoming illegal
expenditure of taxpayer funds pursuant to the [FY] 2018 budget”).) 4 Feldman also
4 For purposes of this Memorandum Opinion, the Court will construe the complaint as challenging each annual budget from 2016 to the present. However, notably, the parties disagree as to whether the FY 2016 budget was actually enacted pursuant to the procedures set forth in the Budget Autonomy Act or the pre-amendment procedures of the Home Rule Act. (Compare DeWitt’s Mot. at 12 n.6 (“[A]s the District has shown, the [FY 2016] budget was submitted in full compliance with the Home Rule Act.”) and Bowser’s Mot. at 24 (“In passing the [FY 2016] budget, District lawmakers unequivocally complied with [the] requirements [of the Home Rule Act].”) with Pl.’s Opp’n at 22 (“At a minimum, there is a factual dispute that cannot be resolved on this motion or without jurisdictional discovery.”).) For purposes of this Memorandum Opinion, which addresses Defendants’ motions to dismiss, the Court accepts Feldman’s position that the FY 2016 budget was enacted pursuant to the Budget Autonomy Act.
8 claims that the District’s alleged “illegal, unlawful, and ultra vires actions [in enacting
these budgets] have injured and are injuring Plaintiff irreparably in her interests as a
taxpayer and will continue to injure Plaintiff irreparably unless and until Defendants are
enjoined from incurring such obligations and making such expenditures or otherwise
ordered to cease and desist.” (Compl. ¶ 43.)
In their motions to dismiss, Defendants argue, inter alia, that Feldman cannot
proceed because her status as an individual District taxpayer does not give her standing
to bring what is essentially a policy-based challenge to the Budget Autonomy Act and
the annual budgets passed under the Act’s amended procedures. (See DeWitt’s Mot. at
11–15; Bowser’s Mot. at 17–22.) In her opposition brief, Feldman maintains that she
has identified an unlawful expenditure pursuant to the Budget Autonomy Act, as is
required for municipal taxpayer standing, because she has challenged the entire local
portion of the budget, and all expenditures pursuant thereto. (See Pl.’s Opp’n at 14–
17.)
This case was originally assigned to Judge Emmet Sullivan pursuant to a notice
of related case that Feldman filed in which she represented that the instant case was
related to the prior litigation between the Council, then-Mayor Gray, and DeWitt. (See
Notice of Related Case, ECF No. 2 (contending that the instant case is related to Gray,
42 F. Supp. 3d 134).) Bowser objected to the related-case designation (see Def.
Bowser’s Obj. to Pl.’s Notice of Related Case, ECF No. 11), and on July 14, 2016—
after both of the instant motions to dismiss were already fully briefed (see DeWitt’s
Mot.; Bowser’s Mot.; Pl.’s Opp’n; Def. Bowser’s Reply in Supp. of Mot. to Dismiss
(“Bowser’s Reply”), ECF No. 19; Def. DeWitt’s Reply, ECF No. 20)—Judge Sullivan
9 determined that Feldman’s case was not related to Gray under this Court’s local rules
(see Min. Order of July 14, 2016). The instant case was randomly reassigned to this
Court the next day, and the Court heard the parties’ oral arguments regarding the
motions to dismiss during a motion hearing held on October 3, 2017.
II. LEGAL STANDARDS
A. Motions To Dismiss For Lack Of Standing Under Rule 12(b)(1)
Article III of the Constitution limits the judicial power of the federal courts to
“[c]ases” and “[c]ontroversies[,]” U.S. Const. art. III, § 2, and that limitation creates a
jurisdictional requirement that a plaintiff have standing to sue, see Lujan v. Defs. of
Wildlife, 504 U.S. 555, 560 (1992). Because it is a plaintiff’s burden to demonstrate
that the court has subject-matter jurisdiction over her claims, “[e]very plaintiff in
federal court bears the burden of establishing the three elements that make up the
‘irreducible constitutional minimum’ of Article III standing: injury-in-fact, causation,
and redressability.” Dominguez v. UAL Corp., 666 F.3d 1359, 1362 (D.C. Cir. 2012)
(quoting Defs. of Wildlife, 504 U.S. at 560–61); see also Dist. No. 1, Pac. Coast Dist.,
Marine Eng’rs’ Beneficial Ass’n, AFL-CIO v. Liberty Mar. Corp., 70 F. Supp. 3d 327,
340 (D.D.C. 2014) (“[T]he plaintiff bears the burden of establishing the existence of
jurisdiction by a preponderance of the evidence.”).
Courts consider motions to dismiss a complaint for lack of standing pursuant to
Federal Rule of Civil Procedure 12(b)(1). See, e.g., Am. Freedom Law Ctr. v. Obama,
821 F.3d 44, 48 (D.C. Cir. 2016). When evaluating whether or not a plaintiff has
established the three elements of standing, courts must be mindful of the stage of the
litigation, because “each element must be supported in the same way as any other
10 matter on which the plaintiff bears the burden of proof, i.e., with the manner and degree
of evidence required at the successive stages of the litigation.” Defs. of Wildlife, 504
U.S. at 561 (citation omitted); accord Food & Water Watch, Inc. v. Vilsack, 808 F.3d
905, 912–13 (D.C. Cir. 2015). Thus, at the pleading stage, “a complaint must state a
plausible claim” that the elements of standing are satisfied, Humane Soc’y of U.S. v.
Vilsack, 797 F.3d 4, 8 (D.C. Cir. 2015) (citations omitted), and when deciding whether
or not a plaintiff’s assertion of standing is plausible, “the court must accept as true all
of the factual allegations in the complaint and draw all reasonable inferences in favor of
the plaintiff,” Cal. Clinical Lab. Ass’n v. Sec’y of Health & Human Servs., 104 F. Supp.
3d 66, 74 (D.D.C. 2015). However, “the court need not accept factual inferences drawn
by plaintiffs if those inferences are not supported by facts alleged in the complaint, nor
must the Court accept plaintiff’s legal conclusions.” Austin-Spearman v. AARP &
AARP Servs. Inc., 119 F. Supp. 3d 1, 8 (D.D.C. 2015) (internal quotation marks and
citation omitted). In addition, “those factual allegations receive closer scrutiny than
they would in the Rule 12(b)(6) context.” Jeong Seon Han v. Lynch, 223 F. Supp. 3d
95, 103 (D.D.C. 2016) (internal quotation marks and citation omitted).
Finally, while reviewing a motion to dismiss pursuant to Rule 12(b)(1), “it has
been long accepted that the judiciary may make appropriate inquiry beyond the
pleadings to satisfy itself on authority to entertain the case.” Dalley v. Mitchell
Rubenstein & Assocs., P.C., 172 F. Supp. 3d 6, 11 (D.D.C. 2016) (quoting Hasse v.
Sessions, 835 F.2d 902, 906 (D.C. Cir. 1987)).
11 B. Municipal Taxpayer Standing Doctrine
As a general matter, it is well established that an individual’s status as a federal
or state taxpayer does not convey Article III standing to challenge the expenditure of
taxpayer funds, because “the interest of a [] taxpayer in seeing that [] funds are spent in
accordance with the Constitution does not give rise to the kind of redressable ‘personal
injury’ required for Article III standing.” Hein v. Freedom From Religion Found., Inc.,
551 U.S. 587, 599 (2007). This is so because a plaintiff must make a showing that “he
has sustained or is immediately in danger of sustaining some direct injury[,] . . . and not
merely that he suffers in some indefinite way in common with people generally.” Id.
(quoting Frothingham v. Mellon, 262 U.S. 447, 488 (1923)). And an individual
taxpayer ordinarily cannot claim that, “having paid lawfully collected taxes into the
Federal Treasury at some point, [she] ha[s] a continuing, legally cognizable interest in
ensuring that those funds are not used by the Government in a way that violates the
Constitution[,]” which is another way of saying that that “type of interest is too
generalized and attenuated to support Article III standing.” Id. (emphasis omitted); see
also id. at 598 (“The constitutionally mandated standing inquiry is especially important
in a case . . . in which taxpayers seek to challenge laws of general application where
their own injury is not distinct from that suffered in general by other taxpayers or
citizens.” (internal quotation marks and citation omitted)); DaimlerChrysler Corp. v.
Cuno, 547 U.S. 332, 345 (2006) (“The [] rationale for rejecting federal taxpayer
standing applies with undiminished force to state taxpayers.”).
However, there is one circumstance in which the Supreme Court has recognized
that a taxpayer may suffer a sufficiently particularized injury to qualify for Article III
12 standing to sue the governmental entity that allegedly mishandled the public fisc.
Unlike taxpayers whose money supports federal and state governments, the Supreme
Court has concluded that municipal taxpayers are sufficiently close to the budgeting
decisions that city governments make that they can sustain particularized, redressable
injuries as a result of those spending decisions, but only if they seek to “challeng[e] a
specific expenditure of public funds” on the grounds that public money has been “used
unlawfully” by a city government. D.C. Common Cause v. District of Columbia, 858
F.2d 1, 8–9 (D.C. Cir. 1988) (quoting Doremus v. Bd. of Educ. of Borough of
Hawthorne, 342 U.S. 429, 434 (1952)). The Supreme Court first explicitly recognized
the distinction between federal taxpayer standing and municipal taxpayer standing in
1923, when it observed that a federal taxpayer’s “interest in the moneys of the treasury
. . . is shared with millions of others, is comparatively minute and indeterminable, and
the effect upon future taxation, of any payment out of the funds, so remote, fluctuating
and uncertain,” that an individual’s status as a federal taxpayer “afforded [no basis] for
an appeal to the preventive powers of a court of equity.” Frothingham, 262 U.S. at 487.
By contrast, “[t]he interest of a taxpayer of a municipality in the application of its
moneys is direct and immediate and the remedy by injunction to prevent their misuse is
not inappropriate.” Id. at 486. Consequently, the Supreme Court acknowledged the
Article III standing of “resident taxpayers [who] sue to enjoin an illegal use of the
moneys of a municipal[ity.]” Id.
Relying on Frothingham, the D.C. Circuit observed almost thirty years ago that
“[t]he distinction between federal and municipal taxpayer standing retains its vitality.”
Common Cause, 858 F.2d at 3. But it is clear that a plaintiff who claims an injury in
13 her capacity as a municipal taxpayer does so under a narrow exception to the general
principles of standing law; she must purport to bring “a good-faith pocketbook action.”
Id. at 4 (quoting Doremus, 342 U.S. at 434); see also Nichols v. City of Rehoboth
Beach, 836 F.3d 275, 280–81 (3d Cir. 2016) (“Though a municipal taxpayer may, in
some cases, challenge municipal expenditures, her right to do so is not unlimited[, and
w]e have applied the ‘good-faith pocketbook’ requirements, articulated by the Supreme
Court in Doremus, to municipal taxpayer standing.”). Thus, in order to satisfy “the
injury requirement” of standing, the “municipal taxpayer [must] establish that the
challenged activity involves a measurable appropriation or loss of revenue,” and that
“tax moneys are [actually being] spent” on that inappropriate activity. Common Cause,
858 F.2d at 4–5; see also Smith v. Jefferson Cty. Bd. of Sch. Comm’rs, 641 F.3d 197,
210 (6th Cir. 2011) (en banc) (“[M]unicipal taxpayers may fulfill the injury requirement
by pleading an alleged misuse of municipal funds.”). Therefore, as “carefully
defin[ed]” in this circuit, the “injury” to a municipal taxpayer for standing purposes is
“the misuse of public funds[.]” Common Cause, 858 F.2d at 5.
What is more, a plaintiff claiming standing to sue as a municipal taxpayer “must
also establish that the challenged action caused the injury[,] and that the injury would
be redressed by a favorable decision.” Id. (citation omitted); see also Smith, 641 F.3d
at 209. And where the alleged injury to the taxpayer is “the misuse of municipal
funds[,]” the causation and redressability requirements demand a showing that, “[b]y
enjoining an illegal expenditure, the court can redress the taxpayer’s injury caused by
the misuse of public funds and ensure that the funds will be devoted [only] to lawful
purposes of possible benefit to the taxpayers.” Common Cause, 858 F.2d at 5; see also
14 Smith, 641 F.3d at 215 (adopting Common Cause’s characterization of the “causation
and redressability” prongs of municipal taxpayer standing as “persuasive”). Indeed,
courts in this jurisdiction recognize a municipal taxpayer’s standing only if she “has
shown that the challenged program involves a measurable appropriation of public
funds,” and that the “misuse of public funds” will be “redressed by an order prohibiting
the expenditure.” Common Cause, 858 F.2d at 5.
III. ANALYSIS
Instead of claiming that the District has made “a specific expenditure of public
funds” for an unlawful purpose, id. at 8, or otherwise “misuse[d] [] public funds[,]” id.
at 5, Feldman seeks to challenge the method by which the District enacts its budget, and
says that the expenditure of any funds pursuant to this allegedly unlawful
methodology—even funds expended for lawful purposes such as fighting fires, policing
crime, and educating children—is ipso facto unlawful due to the previously mandated
procedural steps that the District omitted when it enacted the local portion of its annual
budget in accordance with the Budget Autonomy Act (see Pl.’s Opp’n at 16 (“Plaintiff’s
lawsuit . . . challenges all expenditures being made and all obligations being incurred
pursuant to the process established by the Budget Autonomy Act.” (emphasis added))).
According to Feldman, “[t]he injury is the D.C. government refusing to follow the rule
of law” by allocating funds under the Budget Autonomy Act “and spending money it’s
not allowed to spend.” (Hr’g Tr. at 9:19–21.) But as Defendants rightly note, Feldman
“asks this Court to shut down the District government and nearly everything it does”
(Bowser’s Reply at 6), without maintaining that the District has expended a single
penny to fund an unlawful program, practice, or activity. For the reasons explained
15 below, existing taxpayer standing doctrine does not stretch that far, and this Court sees
no basis for concluding that any such expansion is warranted.
A. Municipal Taxpayer Standing Requires That The Taxpayer Challenge A Discrete Expenditure Of Municipal Funds For An Unlawful Purpose
As explained above, courts in this circuit and elsewhere have required taxpayers
challenging the alleged misuse of public municipal funds to identify a discrete
expenditure of funds for an allegedly unlawful purpose, and also to demonstrate that
stopping the expenditure will ensure that public funds will only be used for lawful
purposes of possible benefit to taxpayers. And Feldman is wrong to suggest otherwise.
(See, e.g., Pl.’s Opp’n at 16 (“Plaintiff is challenging each obligation being incurred
and every taxpayer dollar being expended by Defendants.”).)
The plaintiffs in Common Cause, for example, included three individuals who
claimed standing as District of Columbia taxpayers to challenge allegedly illegal
expenditures that the District had made to influence the outcome of a voting initiative.
See 858 F.2d at 2. According to the plaintiffs, the District had unlawfully expended
municipal funds in furtherance of publicity and propaganda when it “spent nearly
$7,000” and “distributed pamphlets, flyers, and posters” to oppose the initiative. Id. at
2–3. The D.C. Circuit “conclude[d] that the individual [plaintiffs] . . . met the burden
of establishing their standing, as municipal taxpayers, to challenge the District’s use of
public funds to oppose the initiative[,]” id. at 3, because the taxpayers had
“challeng[ed] a specific expenditure of public funds” and requested “an injunction
against” any future “misuse of public funds” for that allegedly unlawful purpose—i.e.,
“an injunction against the use of public funds by the District to campaign against
[voter] initiatives[,]” id. at 8 (emphasis added). The Circuit further explained that the
16 alleged “injury—the District’s future misuse of public funds—will be redressed by an
injunction prohibiting such expenditures” by “ensur[ing] that [the plaintiffs’] taxes are
not used . . . in the future to advance political objectives [the plaintiffs] may oppose,
but only for lawful purposes of potential benefit to them as taxpayers.” Id. at 9. Other
courts have similarly required municipal taxpayers to allege that public funds were
actually expended for some specified unlawful purpose. Where the plaintiffs had
“failed to establish that the Township has spent any money, much less money obtained
through property taxes, on the religious elements” of a particular display, for example,
the Third Circuit rejected an Establishment Clause challenge to a township’s holiday
display, because the plaintiffs had not “carried their burden of proving an expenditure
of revenues to which they contribute that would make their suit ‘a good-faith
pocketbook action.’” ACLU-NJ v. Twp. of Wall, 246 F.3d 258, 263–64 (3d Cir. 2001)
(quoting Doremus, 342 U.S. at 434); see also, e.g., Am. Humanist Ass’n, Inc. v. Douglas
Cty. Sch. Dist. RE-1, 859 F.3d 1243, 1260 (10th Cir. 2017) (rejecting municipal
taxpayer standing “[b]ecause plaintiffs have not shown evidence of a specific,
measurable municipal expenditure on the challenged conduct” (i.e., allegedly promoting
Christian religion in the county’s public schools)); Clay v. Fort Wayne Cmty. Sch., 76
F.3d 873, 879 (7th Cir. 1996) (finding plaintiffs “lack[ed] standing as municipal
taxpayers” because they “failed to raise any specific challenge to an unlawful
expenditure of municipal funds[,]” and “[m]unicipal taxpayer status does not confer
standing absent some allegation by the plaintiffs of an illegal use of tax revenues”).
By contrast, the law does not support Feldman’s contention that a municipal
taxpayer has standing to challenge the lawfulness of the overall method or process by
17 which the city government allocates funds or makes expenditures that are otherwise
entirely lawful. Indeed, it is the outcome of the budgeting process—i.e., the
municipality’s expenditure of taxpayer funds for unlawful purposes rather than lawful
ones—that actually implicates a taxpayer’s fiscal interests, see Common Cause, 858
F.2d at 4–5, and purely process-based claims are ballot-box issues that do not cause
cognizable injuries to taxpayers and cannot be adequately redressed in a federal court.
Cf. Brown v. Hansen, 973 F.2d 1118, 1122 (3d Cir. 1992) (“Under [the political
question] doctrine, courts generally refuse to scrutinize a legislature’s choice of or
compliance with internal rules and procedures.”). A relatively recent Third Circuit
decision underscores this point. In Nichols v. City of Rehoboth Beach, 836 F.3d 275
(3d Cir. 2016), a taxpayer sought to challenge the city’s use of $52.5 million in
municipal funds to pay for “an ocean outfall project” that had been allocated and
approved for expenditure through a special election. Id. at 277. The plaintiff claimed
that the special election itself (and thus the resulting issuance of municipal funds) was
unlawful because the method by which the election was conducted violated the
Fourteenth Amendment. See id. at 277–78. But the circuit court rejected the plaintiff’s
claim that “she ha[d] standing to challenge the $52.5 million in municipal debt incurred
by an allegedly unlawful special election[,]” because the plaintiff had “not challenged
the expenditure of the $52.5 million” as unlawful. Id. at 279 (emphasis added).
Significantly for present purposes, the Nichols court made clear why the plaintiff’s
challenge did not present the kind of “good-faith pocketbook” claim that is required for
municipal taxpayer standing: “[b]ecause the $52.5 million was not spent on an illegal
practice[.]” Id. at 282; see also id. (emphasizing that “[t]he only expenditure that
18 Nichols can challenge is the cost of holding the special election—not the resultant
issuance of bonds”).
Stated succinctly, the Third Circuit appears to have recognized that, because the
only cognizable injury to the taxpayer is that discrete public funds derived from her
taxes were misused for some unlawful purpose, see Common Cause, 858 F.2d at 5
(defining the municipal taxpayer’s injury as “the misuse of public funds”), a municipal
taxpayer is without standing to challenge the process (budget-related or otherwise) by
which expenditures are approved and made. Accordingly, it concluded that, where an
allegedly deficient process results in funds being expended only for lawful purposes of
potential benefit to taxpayers, there is no injury, and there is also nothing for the court
to remedy.
This all means that, far from Feldman’s vision of the municipal taxpayer
doctrine, a plaintiff who claims standing to challenge a municipality’s expenditure of
public funds based solely on her status as a taxpayer must show that funds were actually
expended for discrete identified, unlawful purposes—thus demonstrating that the
expenditure injured her. See id. at 4 (“One commentator has interpreted [the municipal
taxpayer doctrine] as requiring a taxpayer to challenge an activity involving an
expenditure of public funds that would not otherwise be made.”). Moreover, the
municipal taxpayer plaintiff must show that, if the challenged activity were to cease,
those otherwise-unlawfully-expended funds could be redirected toward some lawful
purpose of potential benefit to the taxpayer—thus demonstrating that the injury is
redressable. See id. at 5 (“By enjoining an illegal expenditure, the court [must be able
to] redress the taxpayer’s injury caused by the misuse of public funds and ensure that
19 the funds will be devoted to lawful purposes of possible benefit to the taxpayers.”).
And where the plaintiff fails to make the requisite showing, the plaintiff’s claim must
be dismissed for lack of standing. See, e.g., Freedom From Religion Found., Inc. v.
Zielke, 845 F.2d 1463, 1470 (7th Cir. 1988) (affirming dismissal for lack of municipal
taxpayer’s standing to challenge “allegedly unconstitutional display” in city park,
because plaintiff “did not establish that the [city] has used tax revenues on the
[display]”); Patterson v. Rawlings, 287 F. Supp. 3d 632, 642–43, 645 (N.D. Tex. 2018)
(granting motion to dismiss for lack of standing where municipal taxpayer “failed to
adequately plead that tax money was spent in connection with the [allegedly unlawful]
removal of the [General Robert E.] Lee [s]tatue or any other Confederate monument”);
see also Pelphrey v. Cobb Cty., Ga., 547 F.3d 1263, 1280 (11th Cir. 2008) (stating that
municipal taxpayer standing exists only where “the taxpayer . . . can establish that tax
expenditures were used for the offensive practice[,]” such as the expenditure of public
funds to offer invocational speakers in violation of the Establishment Clause).
B. Feldman Has Not Alleged That Municipal Funds Are Being Expended For An Unlawful Purpose, And Therefore Seeks An Unwarranted Expansion Of The Municipal Taxpayer Standing Doctrine
Feldman’s claims in the instant case resemble those that the Third Circuit
rejected in Nichols—and must suffer a similar fate. Indeed, Feldman does not claim
that the District has used any municipal funds to make illicit expenditures, and she fully
acknowledges that her only basis for claiming that the District has unlawfully expended
taxpayer funds is “[b]ecause of the process” by which the District allocates funds under
the Budget Autonomy Act. (Hr’g Tr. at 6:21–22; see also id. at 15:20–16:2 (asserting
that she is not challenging “where the money is going” or “how much money the
[District] is allotting” to, for example, “the fire department, . . . the police department,
20 [or] . . . the teachers”).) Nor does Feldman purport to argue that the District would
have spent taxpayer money any differently if the challenged budgets had been approved
under the pre-amendment provisions of the Home Rule Act. (See id. at 16:4–17:4.)
Thus, Feldman cannot proceed with the instant lawsuit. See Nichols, 836 F.3d at
282 (“In order for a plaintiff to gain access to federal court using municipal taxpayer
standing, she must show that the municipality has actually expended funds on the
allegedly illegal elements of the disputed practice.”). Feldman’s insistence that the
alleged unlawfulness of the budgeting process itself makes every dollar allocated
pursuant to the Budget Autonomy Act an unlawful expenditure (see Pl.’s Opp’n at 14,
16) finds no support in the case law, or the principles that undergird the municipal
taxpayer standing doctrine. To the contrary, both make clear that what matters for the
purpose of establishing a cognizable injury to taxpayers is not the method by which city
officials undertake to make lawful expenditures that may well have been made even
absent the allegedly unlawful conduct, but the city’s investment of taxpayer dollars on
things that are themselves unlawful, which qualifies as a waste of limited resources that
could otherwise have been spent to make legitimately beneficial expenditures. See
Common Cause, 858 F.2d at 4–5.
Thus, it is clear beyond cavil that permitting Feldman’s challenge would
“expand[ the] municipal taxpayer standing doctrine to encompass [a] far broader
category of challenges” (Bowser’s Mot. at 18) than the sorts of “good-faith pocketbook
action[s]” contemplated in Common Cause, 858 F.2d at 4 (internal quotation marks and
citation omitted). Indeed, Feldman apparently launched this action to advocate for
allowing municipal taxpayers to “[act as] Attorney[s] General and police the policies of
21 the District because they pay taxes here[.]” (Hr’g Tr. at 48:24–49:14.) But this Court
is not persuaded that it should expand the reach of the narrow standing exception
available to municipal taxpayers under Frothingham and Common Cause, and the Court
is especially cautious in this case, given that no other court in this circuit has addressed
municipal taxpayer standing in the thirty years since Common Cause was decided, much
less affirmed a plaintiff’s standing based on her status as a municipal taxpayer. 5
IV. CONCLUSION
There is presently a narrow window of opportunity for a municipal taxpayer
claiming “misuse of funds” to proceed in federal court; Article III standing can be
established if such a taxpayer challenges a discrete expenditure of public funds for an
unlawful purpose, such that a court order enjoining the challenged expenditure will
permit funds to be reallocated to lawful purposes of potential benefit to the plaintiff and
other taxpayers. Feldman makes no such allegation. Instead, she seeks to challenge the
5 For what it is worth, the Court notes that the tide appears to be turning against the recognition of municipal taxpayer standing in general. Even thirty years ago, some jurists expressed a concern that “[m]unicipal taxpayer standing appears on its face inconsistent with current principles of constitutional standing.” Common Cause, 858 F.2d at 11 (Williams, J., concurring); see also id. at 12 (“[T]he evolution of standing doctrine has significantly undermined the original case for municipal taxpayer standing, however strong one may perceive that case.”). And modern standing principles have continued to develop in the decades since, while the municipal taxpayer doctrine has not budged. In recent years, the Supreme Court has further constrained the ability of federal and state taxpayers to claim standing, based on its determination that any injury to a taxpayer “is not concrete and particularized, but instead” is “suffer[ed] in some indefinite way in common with people generally,” and also “is not actual or imminent, but instead [is] conjectural or hypothetical.” Cuno, 547 U.S. at 344 (internal quotation marks and citations omitted); see also Hein, 551 U.S. at 599 (roundly rejecting, as “too generalized and attenuated to support Article III standing[,]” the “interest of a federal taxpayer in seeing that Treasury funds are spent in accordance with the Constitution”). Moreover, to the extent that the rationale behind municipal taxpayer standing “appears to rest on the assumption that the relatively small number of taxpayers involved and the close relationship between residents of a municipality and their local government results in a direct and palpable injury whenever tax revenues are misused[,]” that assumption is tenuous at best in modern times; we have undoubtedly entered “an age in which some cities boast populations in the millions[.]” Smith, 641 F.3d at 210 (internal quotation marks and citation omitted); see also id. at 221 (Sutton, J., concurring) (“Whatever the virtue of a line between state- and municipal-taxpayer standing at its birth 88 years ago, the point of the demarcation is difficult to grasp today.” (citation omitted)).
22 District’s annual budget procedures, as prescribed in the allegedly unlawful Budget
Autonomy Act, and she does not maintain that the illegal process has actually caused
any funds to be expended for unlawful purposes. Thus, this Court concludes that
Feldman has not brought a good-faith pocketbook action that can be pursued in federal
court based solely on her status as a municipal taxpayer. Accordingly, and on that basis
alone, Defendants’ motions to dismiss will be GRANTED and Feldman’s case will be
dismissed, as set forth in the accompanying Order.
DATE: May 30, 2018 Ketanji Brown Jackson KETANJI BROWN JACKSON United States District Judge