1 The JTPA provision for migrant
and seasonal worker programs is codified at 29 U.S.C. §1672 (1994).
2 Although Job Service sought
review only of the grant for North Dakota, the facts concerning the grants for South Dakota and
Minnesota are connected to the facts concerning North Dakota. For ease of reference, we will
refer to
South Dakota, North Dakota, and Minnesota as "the three states."
3 The SGA contained a
typographical error that reduced from 25 to 15 the points available for "familiarity with the
area
to be served." This error had the effect of reducing the total rating points available to all
applicants to 90, instead of 100.
4 Midwest also submitted a
challenge to its non-selection for the North Dakota grant, as well as challenges to its
non-selection for
the Minnesota and South Dakota training grants. See Midwest Farmworker Employment &
Training,
Inc. v. UnitedStates Dep't of Labor, ARB Case Nos. 99-007, 99-056, 99-057,
99-058, 99-
059, and 99-060, ALJ Case Nos. 97-JTP-20, -21, and -22, Order of Dismissal, March 31, 1999
(Midwest Farmworker). The Job Service case and the MidwestFarmworker cases were assigned to the same administrative law judge for hearing.
Although Midwest's challenges also focused on alleged technical errors in
the
grant solicitation process, Midwest additionally alleged a series of ethical violations by
Department
personnel involved in the JTPA grant program. Midwest assailed the "prejudicial altering
of the
point totals available under the SGA," arguing that the alteration had harmed its chances of
winning the grant. Midwest also contended that Charles Kane, the Director of the
Division of
Migrant and Seasonal Farmworker Programs at the Department, had an improperly close
relationship
with Motivation's Director, Frank Acosta, who had sent gifts of foodstuffs to Kane's home.
See
generally, Midwest Farmworker, supra.
Although Motivation was not a party to the Midwest Farmworker
proceeding, Acosta submitted to the ALJ a written defense of Kane's conduct. Midwest argued
that
Acosta's letter documented further instances showing the improperly close social relationship
between
Kane and Acosta. Id.
Midwest also noted that a Motivation employee, Sammy Ibarra, had
embezzled
JTPA funds. Midwest argued in its challenge that because of the embezzlement, Motivation was
not
a "responsible" entity within the meaning of the JTPA and could not lawfully receive
a
grant. Id.
5 As further support for this
proposition, we note that on July 15, 1998, the Department filed a Motion for Extension of Time
to File
Posthearing Briefs, stating that Job Service's receipt of the transcripts in this case and in the
Midwest
Farmworker case had been delayed, and that Job Service "needs time to review the
transcripts
and incorporate pertinent information in its posthearing brief." (emphasis added).
6 Other than the ALJ's post-
decisional statement that the Midwest Farmworker and Job Service cases had
been
consolidated "at the time of hearing," we find no evidence that a decision to
consolidate had
been made by the ALJ. Indeed, the fact that the ALJ issued separate decisions in the cases
suggests that
the two proceedings had not been consolidated officially, even if it somehow had been
decided
that the record from one case could be cited in the other. The ALJ's unusual post-decision Order
attempting to consolidate the Midwest Farmworker and Job Service cases on
appeal
before the Board exceeded the ALJ's authority.
7 Kane has since retired from the
Department. Midwest Farmworker hearing transcript (MFET T.) at 552.
8 The ALJ did not, however,
address
most of the issues Job Service raised concerning the merits of its application. See p.6,
supra.
9 The Campesinos
decision
involved an unsuccessful applicant's challenge of grants for training migrant and seasonal
workers
during two distinct grant periods. The first of the two grant programs involved was authorized
by the
Comprehensive Employment and Training Act (CETA) and the second was authorized by
CETA's
successor statute, the JTPA. At the time of the court's decision, the grant periods had expired for
both
of the challenged grants. Relying upon the regulation at 20 C.F.R. §633.205(e), the Ninth
Circuit
found the controversy moot as to both of the challenged grants.
10 The ALJ's decision was
issued on October 19, 1998. The ninetieth day following issuance of his decision was January
17, 1999,
which in turn was less than six months prior to the end of the funding period on June 30, 1999.
11 Job Service has not
challenged the regulation before the Administrative Review Board, and even if it had, the Board
is
without jurisdictional authority to rule on the validity of duly promulgated Department
regulations.
Secretary's Order 2-96, 61 Fed. Reg. 19,978 (May 23, 1996).
12 Because we dismiss this
case as moot, it is unnecessary for us to reach any conclusions on the merits of the case.
However, we
note that even if the case were not moot, and even if the ALJ had awarded the proper remedy
under the
regulations, our doubts concerning several of the ALJ's key findings of irregularities in the grant
application process would compel us to reevaluate the ALJ's conclusions. For example, the
finding that
Kane was "prejudiced" against farmworkers, discussed at length by the ALJ, was
based upon
comments Kane made at a meeting in Coeur D'Alene, Idaho, after the award of the grants
at
issue. Moreover, any purported prejudice against farmworkers on Kane's part would apply
equally to
the successful applicant, Motivation, which was operated by farmworkers. MFET T. 489.
Because
Kane did not review the application or select Motivation, Kane's alleged prejudice against
farmworkers
which was an important element of the ALJ's analysis seems irrelevant.
The ALJ also appeared to err in assessing the facts concerning the
embezzlement
of funds by one of Motivation's employees, Ibarra. After the ALJ raised questions at the hearing
about
the Ibarra incident, the Department reported that "the OIG is not aware of any evidence
indicating
that anybody within [Motivation] besides Mr. Ibarra was involved in" or "aware
of"
the embezzlement of JTPA funds, and that "Motivation officials were completely
cooperative
during the investigation of Ibarra's activities." Midwest Farmworker record:
Shapiro
affidavit, attached to June 10, 1998 report to ALJ. Moreover, the Department explained
that
Ibarra had been ordered to pay restitution, id., and the Midwest Farmworker
record
contains a photocopy of the judgment in Ibarra's criminal case, noting that Ibarra had paid some
$14,052.80 in restitution. Midwest Farmworker record: Midwest Exhibit 1, Judgment, at
pp.
2,4. Notwithstanding this evidence, the ALJ curiously found that Ibarra's embezzlement of funds
was
not an isolated incident and that "there is no evidence that the embezzled funds were
returned." D&O at 8. We question those findings.
We also question the ALJ's finding that Kane's alleged bias in favor of
Motivation
made the grantee selection process unfair, when the weight of the evidence suggests that the
persons
charged with conducting the review were free from bias. The selection process began when DOL
employee Irene Pindle arranged for publishing the SGA for grants in the three states. MFET T.
913.
After publication, Pindle discovered the typographical error in the number of points allotted for
"familiarity with area served." MFET T. 914. The ALJ found that Pindle did not act
with
any bias. D&O at 9. Next in the grant application process, three panel members evaluated the
grant
applications. The chair of the panel, Roland Brack, testified that he had no conversations with
Kane
about the work of the panel. MFET T. 881-882. Likewise, panel member Ronald Rubbin knew
none
of the applicants and believed that the scoring process was done fairly. MFET T. 999. After the
panel
made its recommendations, Grant Officer James DeLuca reviewed the recommendations and
selected
the grantees. The ALJ found that DeLuca did not act with prejudice and did not know anything
about
gifts from Acosta to Kane. D&O at 9.
Based on the record in this and the Midwest Farmworker cases, it
appears
that the people who actually performed the selection did not act with bias against the
disappointed
applicant, Job Service, or with bias in favor of the grantee, Motivation. The ALJ simply did not
explain
how any prejudice or bias on the part of Kane affected the selection process conducted by Pindle,
the
panel members, and DeLuca.