Status of the Commission on Railroad Retirement Reform for Purposes of the Applicability of Ethics Laws

• Court: Department of Justice Office of Legal Counsel
• Decided: September 14, 1989
• Status: Published

Opinion

Status of the Commission on Railroad Retirement Reform for Purposes of the Applicability of Ethics Laws The Com m ission on Railroad Retirement Reform is not an agency in the executive branch for purposes o f determining what obligations m em bers o f the Com m ission may have under the laws governing conflicts o f interest and financial disclosure.

Because the Com m ission is not part o f the executive branch for these purposes, the O ffice o f Legal Counsel is without authority to advise the Com mission regarding the obligations o f its members under whatever conflicts laws may apply to them.

September 14, 1989

M e m o r a n d u m O p in io n fo r the E x e c u t iv e D i r e c t o r C o m m is s io n on R a il r o a d R e t ir e m e n t R e f o r m

You have asked for our opinion whether the Commission on Railroad Retirement Reform (“Commission”) should be regarded as an agency in the executive branch for purposes o f determining what obligations mem­ bers of the Commission may have under the laws governing conflicts o f interest and financial disclosure. See 18 U.S.C. §§ 201-211; 5 U.S.C. app. §§ 201-211; 2 U.S.C. §§ 701-709. We have examined the relevant statutory provisions and the legislative history of the Commission and have con­ cluded that the Commission should not be considered part o f the execu­ tive branch for the purposes as to which you have inquired. Accordingly, we are unable to advise the Commission’s members regarding their oblig­ ations under applicable conflict o f interest and financial disclosure laws.

Analysis

The Commission was established by section 9033 of the Omnibus Budget Reconciliation Act of 1987, Pub. L. No. 100-203, 101 Stat. 1330, 1330-296 to 1330-299. The status within the government of an office cre­ ated by statute is a matter of statutory interpretation, controlled by leg­ islative intent. Ameron, Inc. v. United States Army Corps of Engineers, 787 F.2d 875, 892-93 (3d Cir.) (Becker, J., concurring in part) (regarding Comptroller General), modified, 809 F.2d 979 (3d Cir. 1986), cert, dis­ missed, 488 U.S. 918 (1988). Neither the statute nor its legislative history, however, expressly provide the branch of the government within which the Commission fits, either for purposes o f determining the applicable 285 ethics and disclosure regulations or otherwise.1 Therefore, inferences must be drawn from the structure and purpose o f the Commission as pro­ vided by the statute. Four o f the Commission’s seven officers are appointed by the President, and the Speaker o f the House o f Representatives, the President pro tempore of the Senate, and the Comptroller General each appoint one o f the remaining three members. § 9033(c)(l)(A)-(C).2 The Commission is directed to

conduct a comprehensive study o f the issues pertaining to the long-term financing o f the railroad retirement system ... and the system’s short-term and long-term solvency. The Commission shall submit a report containing a detailed statement o f its findings and conclusions together with rec­ ommendations to the Congress for revisions in, or alter­ native to, the current system.

§ 9033(b) (emphasis added). The Commission’s study must consider var­ ious factors relating to the economic outlook for the railroad industry and its retirement system, as well as “any other matters which the Commission considers would be necessary, appropriate, or useful to the Congress in developing legislation to reform the system.” § 9033(b)(5) (emphasis added). The Commission is further directed to transmit the report to the President and to each chamber o f the Congress by October I, 1989. § 9033(f).3 With the possible exception of the transmission of its report to the President, the Commission performs only “investigative and informative” functions that could be undertaken by a congressional committee and that are removed from the administration and enforcement of public law. See Buckley v. Valeo, 424 U.S. 1, 126, 137-38 (1976). The Commission’s members therefore need not be officers o f the United States, appointed in conformity with the Appointments Clause o f the Constitution, Article II, Section 2, Clause 2.4 Id. Rather, the Commission’s functions, broadly

1 The statute’s sole ethics provision, an undesignated subpart o f the subsection governing the Commissioner’s manner o f appointment and qualifications, states only that “[a]ll public members o f the Commission shall be appointed from among individuals who are not m the employment o f and are not pecuniarily or otherwise interested in any employer . or organization o f employees.” § 9033(c)(1). 2 Although the President’s power to remove officials would be o f decisive importance in determining whether those officials are executive officers, see Bowsher v. Synar, 478 U.S 714, 726-30 (1986); Mistrelta v United States, 488 U.S 361,423 (1989) (Scalia, J., dissenting), the statute at issue here makes no express provision for removal o f Commissioners, merely providing that u[a] vacancy in the Commission shall be filled in the manner in which the original appointment was made ” § 9033(c)(1) 3 Congress later extended this deadline by one year in section 7108 o f the Technical and Miscellaneous Revenue Act o f 1988, Pub. L No. 100-647, 102 Stat. 3342, 3774 4 The provisions o f the statute relating to provision o f personnel or information by federal agencies to the Commission do not, m our view, vest the Commission or its Chairman with the ability to “exercis[e] Continued

286 considered, are of the sort characteristically exercised by agencies of either the executive branch, see U.S. Const, art. II, § 3 (“[The President] shall from time to time give to the Congress Information o f the State of the Union, and recommend to their Consideration such Measures as he shall judge necessary and expedient. . . Applicability of the Hatch Act to the Chairman of the Native Hawaiians Study Commission, 6 Op. O.L.C. 292, 295 (1982) (“[T]he making o f recommendations to Congress is not a purely legislative function, but falls squarely within the duties and powers o f the Executive.”), or the legislative branch. See Buckley v. Valeo, 424 U.S. at 137-38; McGrain v. Daugherty, 273 U.S. 135, 175 (1927).5 If the Commission were deemed because of these duties to be part of the executive branch, however, other provisions concerning the manner in which the Commission is to execute these duties, as well as the man­ ner o f appointment o f the Commissioners, could raise serious constitu­ tional questions with respect to the statute. As noted above, section 9033(b) requires the Commission to “submit a report containing a detailed statement o f its findings and conclusions together with recom­ mendations to the Congress for revisions in, or alternatives to, the cur­ rent system.” This requirement is recapitulated in section 9033(f), which provides that “[t]he Commission shall transmit a report to the President and to each House o f the Congress [that] shall contain a detailed state­ ment of the findings and conclusions together with recommendations to the Congress for revisions in, or alternatives to, the current system.” This requirement is recapitulated in section 9033(f), which provides that “ [t]he Commission shall transmit a report to the President and to each House of Congress [that] shall contain a detailed statement o f the findings and con­ clusions o f the Commission, together with its legislative recommenda­ tions." (Emphasis added.) It has been the longstanding view o f the Department o f Justice that Article III, Section 3 o f the Constitution vests in the President plenary and

4 (...continued) significant authonty pursuant to the laws o f the United States,” Buckley v Valeo, 424 U.S. at 126, because they do not either directly or indirectly involve the exercise by the Commission o f authonty over or on behalf o f third parties. See Cun'in v Wallace, 306 U S 1, 15 (1939) Indeed, for the most part these pro­ visions merely permit federal agencies to respond to the requests o f the Commission or its Chairman. Section 9033(d)(4) provides that u[u]pon request o f the Commission, the Railroad Retirement Board and any other Federal agency may detail, on a reimbursable basis, any o f the personnel thereof to the Commission to assist the Commission in carrying out its duties under this section ” (Emphasis added ) Similarly, section 9033(e)(1) provides that “[tjhe Commission may, as appwpriate, secure directly from any department or agency o f the United States information necessary to enable it to carry out this sec­ tion Upon request o f the Chainnan o f the Commission, the head o f such department or agency shall, as appropriate, furnish such information to the Commission.” (Emphasis added.) 5The fact that the Commission is required to provide its report both to Congress and the President, and thus might be said to be vested with “(obligations to two branches[, is] not .. impermissible and the presence o f such dual obligations does not prevent [its] characterization as part o f one branch ” Bowsher v. Synar, 478 U S. at 746 (Stevens, J , concum ng in the judgment)

287 exclusive discretion concerning legislative proposals submitted by the executive branch to the Congress. Thus, Congress may not require execu­ tive branch officials to submit legislative proposals to the Congress. See, e.g., Constitutionality of Statute Requiring Executive Agency to Report Directly to Congress, 6 Op. O.L.C. 632, 640 (1982) (legislation mandating submission o f legislative proposals trenches on President’s Article n, Section 3 authority). Similarly, the Department has repeatedly opined that statutes purporting to require that executive branch officials submit reports directly to Congress, without any prior review by their superiors, would raise serious constitutional questions by impairing the President’s constitutional right to direct his subordinates. See, e.g., id.-, Inspector General Legislation, 1 Op. O.L.C. 16, 17-18 (1977) (concurrent reporting requirements in inspector general legislation offends President’s Article II power to direct); see also Myers v. United States, 272 U.S. 52,163-64 (1926) (“Article II grants to the President the executive power of the Government, i.e., the general administrative control o f those executing the laws ....”); Congress Construction Corp. v. United States, 314 F.2d 527, 530-32 (Ct. Cl.), cert, denied, 375 U.S. 817 (1963). The above-referenced reporting pro­ visions of the statute would involve both of these infirmities if the Commission were treated as an executive branch agency.6 In addition, this Office has expressed the view that provision of advice and recommenda­ tions to the executive branch is an executive function, The President’s Power to Remove Members o f the Federal Council on the Aging, 5 Op. O.L.C. 337, 343 (1981), and therefore congressional appointment o f those performing such a function would raise constitutional questions. See Letter for Alexander H. Platt, General Counsel, National Economic Commission, from Douglas W. Kmiec, Deputy Assistant Attorney General, Office o f Legal Counsel (June 22, 1988).7 Against the background of such constitutional questions we are obliged to “first ascertain whether a construction o f the statute is fairly possible by which the question may be avoided.” Crowell v. Benson, 285 U.S. 22, 62 (1932). See also International Ass’n o f Machinists v. Street, 367 U.S.

6 Although the Department o f Justice has narrowly interpreted such broadly worded provisions in statutes unquestionably applying to executive branch agencies in the past to avoid raising these consti­ tutional issues, see, e.g., 41 Op. Att’y Gen. 507, 525 (I960), 6 Op. O.L.C. at 643, it would be anomalous to so construe the reporting provisions o f this statute, where the basis for such a construction — the applic­ ability o f such provisions to an executive branch entity — is itself in dispute. 7 The fact that a majority o f its members are appointed by the President, although o f some significance, is not in our view dispositive o f the Commission’s status, particularly where, as in this case, three o f the President’s four appointees are to be “appointed on the basis o f recommendations made by” repre­ sentatives o f railroad employers, railroad employees, and commuter railroads, respectively. § 90 33(c)(l)(A )(i)-(iii). The remaining Presidential appointee is to be appointed from among “members o f the public." § 9033(c)(l)(A )(iv). Cf. § 9033(c)(1)(B) (Speaker’s appointee from among members o f the public); § 9033(c)(1)(C ) (President pro tempore’s appointee from among members o f the public); § 9033(c)(1)(D ) (Comptroller General’s appointee from among members o f the public with expertise in retirement systems and pension plans). We express no opinion concerning the validity o f these appoint­ ment provisions.

288 740, 749-50 (1961); Ashwander v. TVA, 297 U.S. 288, 348 (1936) (Brandeis, J., concurring). In our view, it is reasonable to construe the two reporting provisions as contemplating that the Commission’s report would be pre­ pared principally for Congress’ benefit, with the President as an inciden­ tal recipient. The statute’s detailed reporting provision makes no refer­ ence to the President and expressly states that the Commission is to submit a report of its findings, conclusion, and recommendations “to the Congress," including, inter cilia, “any other matters ... necessary, appro­ priate, or useful to the Congress.” § 9033(b) (emphasis added). Cf. 31 U.S.C. § 719(a) (Comptroller General, a legislative officer, is required to provide Congress with annual report but must also provide it to President upon his request); see generally Bowsher v. Synar, 478 U.S. at 745-46 (Steven J., concurring) (Comptroller General’s responsibilities to execu­ tive branch, including responsibility to provide President with reports upon request, do not prevent his being characterized as legislative offi­ cer); Gannett News Service, Inc. v. Native Hawaiians Study Comm’n, No. 82-0163 (D.D.C. June 1, 1982) (for purposes o f Federal Advisory Committee Act, Native Hawaiians Study Commission advisory to Congress, not the President, although both receive copy of final factual report); Applicability of the Federal Advisory Committee Act to the Native Hawaiians Study Commission, 6 Op. O.L.C. 39, 41 (1982) (“That the President is to receive a copy o f the [Native Hawaiians Study Commission] study, perhaps simply as a courtesy or for his general infor­ mation, does not mean the study was intended to ‘advise’ him [for pur­ poses of the Federal Advisory Committee Act].”). Moreover, most of the factors to be considered by the Commission in preparing its report relate to future legislation rather than nonlegislative purposes such as assisting the executive branch in its administration o f existing programs.8 These features o f the bill strongly suggest that Congress created the Commission primarily to assist it, rather than the President, in considering these issues.9 Because such a construction

8 This conclusion is also consistent with the sparse legislative history o f the provision, which notes the Commission role as advisor to the Congress. See 134 Cong Rec. 14,647 (1988) (statement o f Rep. Whittaker) ( “The Commission can pave the way for a comprehensive, consensus approach to needed reforms, and can give the Congress the benefit o f a studied, analytical approach to the problem . ”). 9 Our conclusion is supported by the fact that Congress has in the recent past created other commissions to assist it m legislating in this area See Pub L. No. 91-377, § 7, 84 Stat 791, 792-94 (1970) (creating Commission on Railroad Retirement compnsed o f three Presidential and two congressional appointees to “recommend[] to the Congress ... changes in [the] . benefits thereunder;” its final report was to be sub­ mitted to Congress and the President), Pub L. No. 92-460, § 6, 86 Stat 765, 767 (1972) (requiring represen­ tatives o f railway labor and management to submit to congressional committees and the Railroad Retirement Board a report containing joint recommendations); Pub. L. No. 93-69, § 107, 87 Stat. 162, 165 (1973) (requiring representatives o f railway labor and management to submit to congressional committees a report containing “joint recommendations for restructuring the railroad retirement system ... (which) shall be . in the form o f a draft bill0); Pub L No. 98-76, § 504, 97 Stat. 411, 441-42 (1983) (codified at 45 U S C § 362) (creating Railroad Unemployment Compensation Committee consisting o f representatives of railway labor and management and the public, to submit “a report to the Congress concerning recommendations”)

289 avoids the constitutional problems and is “not only ‘fairly possible’ but entirely reasonable,” Machinists v. Street, 367 U.S. at 750, we are con­ strained to adopt it in this instance.10

Conclusion

Under these circumstances, we conclude that the Commission is not part o f the executive branch o f the government for the purposes as to which you have inquired. Consequently, we are without authority to advise the Commission regarding the obligations of its members under whatever conflicts laws may apply to them. See 28 U.S.C. §§ 511-513. We suggest that you consult with the responsible ethics counsels of the House o f Representatives and the Senate in this regard.11

LYNDA GUILD SIMPSON Deputy Assistant Attorney General Office of Legal Counsel

10 The statute’s housekeeping provisions appear to be o f limited value in assessing Congress’ intent. The General Services Administration, an agency within the executive branch, is directed to provide the Commission with administrative support services on a reimbursable basis, § 9033(e)(3), and federal agencies are authorized to provide personnel and information to the Commission. §§ 9033(d)(4), 9033(e)(1) In addition, the Commission is authorized to use the United States mails “in the same man­ ner and under the same conditions as other departments and agencies o f the United States.” § 9033(e)(2). The Chairman o f the Commission is also authonzed, subject to some limitations, to procure temporary and intermittent services under 5 U S C. § 3109(b), an authonty permanently available to specified agen­ cies in all three branches o f the government § 9033(d)(3). See also 5 U S.C § 5721(1) (defining “agency” for purposes of, inter alia, 5 U.S C § 3109 as an executive agency, military department, federal court or the Administrative Office o f the United State Courts, the Library o f Congress, the Botanic Garden, the Government Printing Office, or the District o f Columbia Government) We regard these provisions as o f limited relevance to the question before us. 11 We are aware that other agencies within the executive branch have considered the Commission’s sta­ tus for purposes o f the Federal Advisory Committee Act (“FACA”), 5 U SC . app. §§ 1-15, and o f the Commission’s funding. We do not regard either the Commission’s unilateral action in filing a charter with the General Services Administration pursuant to FACA or the Commission’s source of funding as neces­ sarily reliable indicia o f Congress’ mtent concerning the Commission’s status within the government for purposes o f the conflicts-of-interest and disclosure laws This office has suggested that the National Economic Commission, which was expressly made subject to FACA by the Congress, was nevertheless not a part o f the executive branch, see Letter for Alexander W. Platt, General Counsel, National Economic Commission, from Douglas W. Kiruec, Deputy Assistant Attorney General, Office o f Legal Counsel (June 22, 1988) Similarly, although an agency’s source o f funding may sometimes be indicative of Congress’ inten­ tions as to its status, see 6 Op. O L C at 41 (provision funding a commission from Senate’s contingent fund evidences mtent that it advise Congress, not the President), the Commission’s source of funding does not support such an inference The Commission's Fiscal Year 1989 appropriation, the first funding provided for the Commission, was contained in title IV, the “Related Agencies” portion of the Departments of Labor, Health and Human Services, and Education and Related Agencies Appropriation Act, 1989, Pub. L No. 100- 436, 102 Stat. 1680, 1709, while the President’s Fiscal Year 1990 budget included the Commission’s budget proposal in the legislative branch appropriation, together with such entities as the Copyright Royalty Tribunal and the General Accounting Office. Budget o f the United States Government, Fiscal Year 1990 — Appendix, at I-A25,1-A24,1-A20 (1989). Even if the contemporaneous legislative source of an agency’s fund­ ing were indicative o f Congress’ mtent as to its status either as a general matter or as regards applicable conflicts-of-interest or disclosure laws, moreover, inferences concerning Congress’ intent in creating the Commission in December 1987 are less reliably drawn from funding enactments in 1988 and later. See gen­ erally Consumer Prod Safety Comm’n v GTE Sylvania, Inc., 447 U S. 102, 117-18 & n.13 (1980)