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11-3100-19452-2 |
STATE OF MINNESOTA
OFFICE OF ADMINISTRATIVE HEARINGS
FOR THE DEPARTMENT OF VETERANS AFFAIRS
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Frank L. Whitman, III,
Petitioner, v.
Hennepin Technical College,
Respondent.
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RECOMMENDED ORDER GRANTING RESPONDENT’S MOTION FOR SUMMARY DISPOSITION
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This matter is pending before Administrative Law Judge Barbara L. Neilson pursuant to a Notice of Petition and Order for Hearing filed by the Commissioner of the Department of Veterans Affairs on January 30, 2008. On February 15, 2008, Respondent Hennepin Technical College filed a Motion for Summary Disposition. Petitioner Frank L. Whitman filed a response in opposition to the motion on February 25, 2008. The OAH record with respect to the motion closed upon receipt of the last reply brief on March 6, 2008.
Marshall H. Tanick and Charles H. Horowitz, Attorneys at Law, Mansfield Tanick & Cohen, P.A., appeared on behalf of Petitioner. David W. Merchant, Assistant Attorney General, appeared on behalf of Respondent.
Based on the record in this matter, and for the reasons set forth in the accompanying Memorandum, the Administrative Law Judge makes the following:
RECOMMENDATION
IT IS RESPECTFULLY RECOMMENDED that the Commissioner of Veterans Affairs GRANT the Respondent’s Motion for Summary Disposition and DISMISS the Petitioner’s petition in this matter with prejudice.
Dated: April 17, 2008
s/Barbara L. Neilson
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BARBARA L. NEILSON Administrative Law Judge |
NOTICE
This report is a recommendation, not a final decision. The Commissioner of Veterans Affairs will make the final decision after a review of the record and may adopt, reject or modify this Recommendation. Under Minn. Stat. § 14.61, the Commissioner shall not make a final decision until this Recommendation has been made available to the parties for at least ten days. The parties may file exceptions to this Recommendation and the Commissioner must consider the exceptions in making a final decision. Parties should contact the Commissioner of Veterans Affairs to learn the procedure for filing exceptions or presenting argument.
If the Commissioner fails to issue a final decision within 90 days of the close of the record, this report will constitute the final agency decision under Minn. Stat. § 14.62, subd. 2a. The record closes upon the filing of exceptions to the report and the presentation of argument to the Commissioner, or upon the expiration of the deadline for doing so. The Commissioner must notify the parties and the Administrative Law Judge of the date on which the record closes.
Pursuant to Minn. Stat. § 14.62, subd. 1, the Commissioner is required to serve its final decision upon each party and the Administrative Law Judge by first class mail.
The facts, viewed in the light most favorable to the Petitioner as the non-moving party, are as follows. The Petitioner was honorably discharged from military service in 1972.[1] He worked as a lab assistant at Hennepin Technical College (HTC) from April 5, 2006, until January 11, 2008, supporting HTC’s Fire Suppression and Fire Rescue Training Programs.[2] HTC is a technical college that provides two-year educational programs that lead to certificates, diplomas, and associate degrees, as well as transfers to four-year colleges. It is part of the Minnesota State Colleges and Universities (MnSCU) system.[3]
During his employment at HTC, Petitioner received a State of Minnesota payroll warrant every two weeks.[4] He was also a member of the American Federation of State, County and Municipal Employees (AFSCME). AFSCME is the exclusive representative for all college laboratory assistants employed by MnSCU institutions, including HTC.[5] AFSCME and the State of Minnesota enter into employment contracts every two years. The AFSCME Collective Bargaining Agreement established the terms and conditions of Petitioner’s employment at HTC, including his rights regarding layoff and recall.[6]
On December 10, 2007, HTC representatives met with the Petitioner and an AFSCME steward, and notified Petitioner that his position was being eliminated and he would be laid off effective January 11, 2008. HTC also gave the Petitioner written notice at the meeting.[7] HTC asserts that the layoff was necessitated by an approximate reduction of $55,000 in the budget for its firefighting programs.[8]
On January 18, 2008, Petitioner filed a Petition for Relief with the Commissioner of Veterans Affairs pursuant to Minnesota Statute § 197.481. In his Petition, the Petitioner alleged that HTC denied him his rights under the Veterans Preference Act (“VPA” or “the Act”) by laying him off in bad faith and by failing to inform him of his right to a hearing under the VPA. He asserted that his former position is being filled by a part-time person working just short of full time. He requested continued receipt of pay and benefits until a hearing under the VPA was held, and ultimate reinstatement with back pay, benefits, and seniority.[9] He contends that he was wrongfully terminated for disciplinary reasons and the budgetary allegations are a mere pretext.[10]
Respondent HTC seeks summary disposition of Petitioner’s claim for relief under the VPA. Summary disposition is the administrative law equivalent of summary judgment. Summary disposition is appropriate where there is no genuine issue as to any material fact and one party is entitled to judgment as a matter of law.[11] The Office of Administrative Hearings has generally followed the summary judgment standards developed in the courts in considering motions for summary disposition of contested case matters.[12]
The moving party has the initial burden of showing the absence of a genuine issue concerning any material fact. A genuine issue is one that is not sham or frivolous. To successfully resist a motion for summary judgment, the nonmoving party must show that there are specific facts in dispute that have a bearing on the outcome of the case.[13] If reasonable minds could differ as to the import of the evidence, judgment as a matter of law should not be granted.[14]
It appears in this case that there are no material facts in dispute. The only issue presented is one of law: whether Petitioner is entitled to a hearing under the Veterans Preference Act to challenge his removal from employment. Respondent contends that, because the college lab assistant position held by the Petitioner with the HTC was a State of Minnesota civil service position, he is not entitled to a VPA hearing regarding his layoff.[15] Notwithstanding this statutory exemption, the Petitioner asserts that he is entitled to the protections of the removal provision of the VPA because MnSCU should be considered a political subdivision of the state.
Analysis
The VPA gives honorably-discharged veterans preference in matters of public employment. Among other things, it prevents veterans covered by the Act from being terminated from public employment unless their termination is due to incompetency, misconduct, or the good faith abolishment of a position.[16] Specifically, Minn. Stat. § 197.46 provides that veterans employed by “counties, cities, towns, school districts and all other political subdivisions in the state” must be notified in writing of the governmental entity’s intention to discharge them from employment and of their right to request a hearing under the VPA within 60 days of receipt of the notice. However, not all veterans employed by public entities are entitled to a hearing under the VPA to challenge their removal from employment under Minn. Stat. § 197.46. Section 197.455, subd. 1, of the VPA specifically exempts state civil service employees from utilizing the Veterans Preference hearing process to challenge a layoff or termination of employment. That subdivision specifies in its entirety:
Subdivision 1. Application. This section shall govern preference of a veteran under the civil service laws, charter provisions, ordinances, rules or regulations of a county, city, town, school district, or other municipality or political subdivision of this state. Any provision in a law, charter, ordinance, rule or regulation contrary to the applicable provisions of this section is void to the extent of such inconsistency. Sections 197.46 to 197.48 shall not apply to state civil service.
After careful consideration of the parties’ arguments in this matter, the Administrative Law Judge concludes that the Petitioner is not entitled to a Veterans Preference hearing under Minn. Stat. § 197.46 to challenge his removal because the Petitioner’s college lab assistant position at HTC was a classified position in the executive branch that falls within section 197.455’s exemption for state civil service employees. Moreover, as explained more fully below, MnSCU is not a “political subdivision” within the meaning of section 197.455.
Chapter 43A of the Minnesota Statutes, which pertains to the state Department of Employee Relations (DOER) and employees of state agencies, defines the term “employee” as “any person currently occupying, or on leave from, a civil service position.”[17] The term “civil service” is defined to mean “all employees in the legislative, judicial and executive branches of state government and all positions in the classified and unclassified service as provided in [Minnesota Statutes] sections 43A.07 and 43A.08.”[18] Under Minn. Stat. § 43A.07, subds. 1 and 2, the Commissioner of the DOER is empowered to maintain and administer a classification plan for state civil service employees holding classified positions established by “an appointing authority.” MnSCU is authorized by Minn. Stat. § 136F.40, subd. 1, to “appoint all . . . necessary employees and . . . prescribe their duties consistent with chapter 43A,” and thus falls within the definition of “appointing authority” set forth in Minn. Stat. § 43A.02, subd. 5. It is undisputed that the Petitioner, like other college lab assistants, was assigned to Technical Unit No. 7 of the State classified service and received paychecks from the State of Minnesota.[19]
Accordingly, it is evident that the Petitioner was employed in a state civil service position. Pursuant to Minn. Stat. § 197.455, state civil service employees are not entitled to a VPA removal hearing under Minn. Stat. § 197.46.
The Petitioner argues that Minn. Stat. § 197.46 still applies because MnSCU is a “political subdivision” covered by the Act. Whether MnSCU is a political subdivision is a question of law.[20] The VPA does not include a definition of “political subdivision.” However, as discussed below, several judicial and administrative decisions in Minnesota have considered how that term should be construed in the context of the VPA.
In Dahle v. Red Lake Watershed District,[21] the Minnesota Court of Appeals relied upon a definition of “political subdivision” found elsewhere in the Minnesota Statutes[22] in ruling that the Red Lake Watershed District constituted a political subdivision subject to the VPA. According to the definition used in Dahle, a “political subdivision” means “any agency or unit of this state which now is, or hereafter shall be, authorized to levy taxes or empowered to cause taxes to be levied.” The Minnesota Supreme Court applied the definition used in the Dahle case in its 1993 decision in Winberg v. University of Minnesota as one basis for its conclusion that the University of Minnesota was not a political subdivision.[23] The Winberg matter involved a consolidated appeal of two cases in which individuals sought to subject the University of Minnesota to the requirements of Minn. Stat. §§ 197.46 and 197.455 relating to the availability of a removal hearing and the application of veterans preference points in hiring. Because the University of Minnesota had no direct or indirect power to cause taxes to be levied, the Court found that the University of Minnesota was not a “political subdivision” for purposes of the VPA under the Dahle definition. The Court further noted that the University of Minnesota was a unique constitutional corporation established by territorial act and perpetuated by the State Constitution; the entire control and management of the University’s affairs and property were vested in the board of regents, with no power to be exercised by the Legislature; the great majority of laws passed by the Legislature expressly included or excluded the University or its Board of Regents; and the VPA did not mention the University or appear to have been drafted with the University in mind.[24] The Court also pointed out that the term “political subdivision” is “commonly understood to mean an entity with a prescribed area and authority for subordinate local government,” and “as used in the [VPA] . . . refers to such traditional units of the state as counties and cities.”[25]
In 2004, the Department of Veterans Affairs adopted the recommendation of Administrative Law Judge Steve Mihalchick in McKinney v. Minnesota State Community and Technical College at Moorhead. The Minnesota State Community and Technical College, like HTC, is part of the MnSCU system. The petitioner, a faculty member whose appointment was not renewed, sought to challenge his removal under Minn. Stat. § 197.46. The petitioner was a member of the state college instructional bargaining unit. The Administrative Law Judge and the Department concluded that the petitioner was not entitled to a VPA hearing to challenge his removal because he was a state employee.[26]
More recently, in Sanders v. Minnesota State Academies,[27] Chief Administrative Law Judge Raymond Krause recommended that summary disposition be granted in favor of Respondent Minnesota State Academies (MSA) with respect to a claim filed under the Veterans Preference Act. In that case, the Petitioner argued that MSA violated Minn. Stat. § 197.455 by not applying a 100-point evaluation system in the application process for a Physical Plant Director position in the classified State service. MSA moved for summary disposition on the grounds that it was a State agency to which Minn. Stat. § 197.455 did not apply. The Petitioner agreed that MSA was a State agency, but argued that it should be considered a political subdivision of the State and therefore subject to the provisions of Minn. Stat. § 197.455. Judge Krause ultimately determined that Minn. Stat. § 197.455 did not apply to MSA and found that the Respondent had complied with the veterans preference provisions that are applicable to State civil service personnel set forth Minn. Stat. § 43A.11. In reaching this conclusion, the Judge emphasized that the MSA is a state agency that is governed by a Board appointed by the Governor with the advice and consent of the Senate; MSA’s budget is included as part of the Governor’s budget and submitted to the State Legislature; MSA is financially dependent on the State and has no independent existence; and the failure of the Legislature to include the State in the list of entities governed by Minn. Stat. § 197.455 demonstrates that the provision was not intended to apply to State agencies.[28]
Finally, several state court decisions have recognized in other contexts that MnSCU is an “arm of the state” or a “state agency.” For example, in O’Sullivan v. State, the Court of Appeals stated that MnSCU “is a state agency that consolidates control of all state universities, community colleges, and technical colleges.”[29] And in Latour v. Minneapolis Community and Technical College, the Minnesota Court of Appeals found it “clear that MCTC is part of MnSCU and that MnSCU is an arm of the state.”[30] Moreover, the Minnesota Federal District Court held in Lewis v. St. Cloud State University, that SCSU, a school encompassed within the MnSCU system, was entitled to immunity under the Eleventh Amendment from the plaintiff’s state law claims under the Minnesota Human Rights Act.[31] The Federal District Court noted that, “[w]hile there is no Eighth Circuit precedent squarely holding that schools in the MnSCU System are entitled to Eleventh Amendment immunity, the authority that does exist is highly suggestive of this conclusion.” In holding that SCSU was entitled to immunity, the Court stressed that, while in some instances MnSCU and state funds are kept separate, “an award against the University would be paid from a budget largely funded by the state treasury.”[32]
Based upon the language of the pertinent statutes and the guidance provided by these decisions, the Administrative Law Judge finds that MnSCU should be considered to be a state agency and not a “political subdivision” within the meaning of the VPA. MnSCU operates a number of colleges and universities located throughout the state,[33] and lacks authority to act as a subordinate government in a prescribed area. There is no evidence that it has direct or indirect power to cause taxes to be levied. MnSCU is governed by a Board of Trustees whose members are appointed by the Governor with the advice and consent of the State Senate.[34] The Legislature has defined the missions of the educational institutions included within MnSCU.[35] The Legislature makes appropriations for MnSCU, and the Board of Trustees must file reports with the Legislature every two years regarding the use of its appropriations and its allocation of resources.[36] All receipts other than those attributable to state college and university activity funds are appropriated to the Board, but are subject to budgetary control by the Commissioner of Finance.[37] Even though MnSCU does have some financial authority independent of the State,[38] it is evident that its budget stems in large part from the State treasury. And, as HTC points out in its reply brief, there is no evidence that the financial independence accorded MnSCU is greater than that afforded the University of Minnesota so as to warrant differing treatment of MnSCU.[39]
Application of the canons of statutory interpretation also support the conclusion that the VPA does not apply to state civil service employees of MnSCU or HTC. Minn. Stat. § 645.27 provides: “The state is not bound by the passage of a law unless named therein, or unless the words of the act are so plain, clear, and unmistakable as to leave no doubt as to the intention of the legislature.” The legislature’s omission of the State from the list of entities set forth in section 197.455, coupled with the express exclusion of state civil service employees, provides further support for the view that State employees were not intended to be covered by the Act. Moreover, in keeping with Minn. Stat. § 645.26, subd. 1, the more specific exemption contained in the last sentence of subdivision 1 of section 197.455 should prevail over the more general statement in the first sentence that the VPA applies to “political subdivisions.”
Conclusion
The Petitioner is not entitled to a hearing to challenge his termination under Minn. Stat. § 197.46 because he was a state civil service employee and because MnSCU is not a “political subdivision” within the meaning of the VPA. The Administrative Law Judge recommends that the Respondent’s motion for summary disposition be granted and that the Petition be dismissed.
B. L. N.
[1] See DD 214N, attached to Notice of Petition and Order for Hearing and Petitioner’s Memorandum in Opposition to Motion.
[2] See Affidavit of Sharon Mohr, ¶ 3; Petitioner’s Memorandum in Opposition to Motion at 2.
[3] Minn. Stat. § 136F.10; Affidavit of Mohr, ¶ 2.
[4] Affidavit of Sharon Mohr, ¶ 3 and Ex. A.
[5] Aff. of Mohr, ¶ 4 and Ex. B.
[6] Aff. of Mohr, ¶ 5.
[7] Petition for Relief under the Veterans Preference Act, attached to Notice of Petition and Order for Hearing; Aff. of Mohr, ¶ 6 and Ex. C.
[8] Aff. of Mohr, ¶ 7 and Exs. C, D and E.
[9] Petition for Relief under the Veterans Preference Act, attached to Notice of Petition and Order for Hearing.
[10] Petitioner’s Memorandum in Opposition to Motion at 1, 2 n.1.
[11] Sauter v. Sauter, 70 N.W.2d 351, 353 (Minn. 1955); Louwgie v. Witco Chemical Corp., 378 N.W.2d 63, 66 (Minn. App. 1985); Minn. R. 1400.5500 K; Minn.R.Civ.P. 56.03.
[12] See Minn. R. 1400.6600.
[13] Thiele v. Stich, 425 N.W.2d 580, 583 (Minn. 1988); Hunt v. IBM Mid America Employees Federal, 384 N.W.2d 853, 855 (Minn. 1986).
[14] Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 250-251 (1986).
[15] The HTC acknowledges that the Petitioner does have rights regarding the layoff under the collective bargaining agreement between AFSCME Council No. 5 and the State of Minnesota.
[16] Minn. Stat. § 197.46; Young II v. City of Duluth, 386 N.W.2d 732, 736 (Minn. 1986); Taylor v. City of New London, 536 N.W.2d 901, 903-04 (Minn. App. 1995).
[17] Minn. Stat. § 43A.02, subd. 21.
[18] Minn. Stat. § 43A.02, subd. 10.
[19] See Minn. Stat. § 179A.10, subd. 2(7); Aff. of Mohr, ¶¶ 3 and 4 and Exs. A and B.
[20] See Winberg v. University of Minn., 499 N.W.2d 799, 802 (Minn. 1993); Schleck v. State, 442 N.W.2d at 359, 361 (Minn. App. 1989); Nickitas v. Sixth Judicial District, No. C2-94-1497, 1995 WL 1468 at *1 (Minn. App. 1995) (unpublished).
[21] 354 N.W.2d 604, 606 (Minn. App. 1984).
[22] Minn. Stat. § 471.49, subd. 3 (relating to resettlement project agreements).
[23] 499 N.W.2d 799, 802 (Minn. 1993).
[24] 499 N.W.2d 799, 801-802 (Minn. 1993).
[25] 499 N.W.2d 799, 802 (Minn. 1993). Accord Nickitas v. Sixth Judicial District, No C2-94-1497, 1995 WL 1468 (Minn. App. 1995) (unpublished) (attached as Ex. C to Aff. of Merchant filed in connection with the Respondent’s Motion for Summary Disposition). In Nickitas, the Court of Appeals, citing Winberg, concluded that a public defender was not employed by a political subdivision and thus was not entitled to a VPA hearing to challenge his discharge because “[t]here is no evidence that the sixth judicial district has the power to tax.” The Court of Appeals also stressed that St. Louis County was “merely a conduit for the state board of public defense, which actually controlled the expenses and policies governing district public defenders.”
[26] OAH Docket No. 12-3100-15929-2 (ALJ Recommendation on Respondent’s Motion for Summary Disposition dated July 29, 2004); (Decision and Order of Department of Veterans Affairs dated Aug. 31, 2004) (attached as Exs. A and B to Affidavit of David Merchant filed in connection with the Respondent’s Motion for Summary Disposition).
[27] OAH Docket No. 2-3100-19211-2 (Jan. 8, 2008).
[28] The decision noted that Minn. Stat. § 43A.11 does not require a veterans preference point system or mandate that all veterans who apply for a position receive an interview.
[29] 1999 WL 1058238, at *3 (Minn. App. Nov. 23, 1999).
[30] 2001 WL 185085, at *2 (Minn. App. Feb. 27, 2001).
[31] The Eleventh Amendment bars federal court jurisdiction over state law claims against unconsenting states or state officials when the state is the real, substantial party in interest. Id. at *10 – 11, citing Cooper v. St. Cloud State Univ., 226 F.3d 964, 968 (8th Cir. 2000).
[32] Civ. 04-4379RHKRLE, 2005 WL 3134064, at *10-11, n. 11 (D. Minn. Nov. 23, 2005) (attached to the Respondent’s Reply Memorandum). The Court relied in part upon Treleven v. Univ. of Minn., 73 F.3d 816, 819 (8th Cir. 1996) (recognizing that “the majority of cases addressing the question of immunity for public colleges and universities . . . have held that these institutions are arms of their respective state governments and immune from suit”); Egerdahl v. Hibbing Cmty. Coll., 72 F.3d 615, 618-19 (8th Cir. 1995) (finding that Hibbing Community College, also part of MnSCU, had not waived its Eleventh Amendment immunity), and Schneeweis v. Northwest Tech. Coll., 1998 WL 420564, at *5 (D. Minn. June 1, 1998) (noting that the decision in Egerdahl “is suggestive, if not conclusive that the [Eighth Circuit] views the Minnesota Community Colleges as being covered by Eleventh Amendment immunity”).
[33] Minn. Stat. §§ 136F.06, 136F.10.
[34] Minn. Stat. § 136F.02, subd. 1.
[35] Minn. Stat. § 135A.052.
[36] Minn. Stat. § 136F.031.
[37] Minn. Stat. § 136F.71, subd. 1.
[38] For example, under Minn. Stat. § 136F.70, MnSCU’s Board of Trustees sets tuition rates for the various instructional programs and may decide to waive tuition under certain circumstances. Under Minn. Stat. §§ 136F.71, subd. 2, receipts attributable to state college and university activity funds are appropriated to the Board and are not subject to budgetary control as exercised by the Commissioner of Finance. Under Minn. Stat. § 136F.76, MnSCU may keep money received from successful litigation by or against the Board. And, under Minn. Stat. § 136F.90, MnSCU may acquire property and may enter into contracts for the purposes of Minn. Stat. §§ 136F.90 to 136F.98 (provided that no contract for the construction of any building may be entered into until the Legislature has approved financing); may issue and sell bonds in amounts authorized by the Legislature and such bonds do not constitute a debt or obligation of the State of Minnesota.
[39] The Petitioner relies on Forman v. Community Services, Inc., 500 F.2d 1246, 1256 (2d Cir. 1974), rev’d on other grounds sub nom United Housing Foundation, Inc. v. Forman, 421 U.S. 837 (1975), for the proposition that “the ability of a state agency to issue bonds without state recourse establishes independence of that agency from the State.” See Memorandum in Opposition to Motion at 6. However, the fact that the State of New York was not liable for the debts of the State Housing Finance Agency was just one factor that the Second Circuit considered in reaching its conclusion that the agency was “sufficiently independent of the State as not to enjoy sovereign immunity.” The Second Circuit also emphasized that the agency “has the express authority to sue and be sued; it acts only as a credit or financing entity; [and] it apparently has no power to take property in its own name or in the name of the State.” In addition, a New York statute had expressly waived sovereign immunity for the agency. The Court thus found that the agency was not an “alter ego” of the State entitled to sovereign immunity. The statutory scheme and relevant case law does not warrant the same conclusion with respect to MnSCU.