Supreme Court of Texas.
Richard Dewayne PROCTOR, Hugh Glen Osborn, John Yeates, and Dan Morales, Attorney General of Texas, Petitioners,
City of Lubbock, Texas and as Managing Director of Human Resources for The City of Lubbock, Texas, Ken Walker, in his official capacity, et al., Respondents.
Argued April 1, 1998.
Decided July 3, 1998.
Rehearing Overruled July 3, 1998.
Attorneys & Firms
*731 B. Craig Deats, Austin, for Petitioners.
Cecil Kuhne, Lubbock, for Respondents.
PHILLIPS, Chief Justice, delivered the opinion for a unanimous Court.
Respondents’ motion for rehearing is overruled. Our opinion of June 5, 1998, is withdrawn and the following substituted in its place.
*732 We must determine whether section 143.057(d).
Under the Civil Service Act, a police officer or fire fighter suspended, passed over for a promotion for disciplinary reasons, or recommended for demotion has the choice of appealing the action to the local civil service commission, section 143.010, or to an independent third-party hearing examiner, (j).
This appeal involves three cases consolidated for trial. Officers Richard Dewayne Proctor, Hugh Glen Osborn, and John Yeates were suspended from the City of Lubbock Police Force for separate alleged violations of the Local Civil Service Rules. The three officers elected to have their appeals heard by a hearing examiner under section 143.057(d). The trial court consolidated all three cases. The Attorney General intervened to defend the statute’s constitutionality.
The City and the police officers all moved for summary judgment. The trial court denied the City’s motion and granted the officers’ motions, declaring Andrews v. Proctor, 950 S.W.2d 750 (Tex.App.—Amarillo 1997). We granted the officers’ and the Attorney General’s separate petitions for review.
As a preliminary matter, we note that all parties erroneously rely on Article III.
The City asserts that section 143.057(d), the Legislature conferred on AAA and FMCS the authority to determine what specific requirements make an arbitrator neutral and qualified, and therefore eligible to serve as a hearing examiner under the statute.
The City also contends that the provision unconstitutionally infringes on its powers as a home rule city. We consider that argument first.
The City argues that Article XI, Section 5 of the Texas Constitution by infringing on the City’s governmental authority to direct, control, and discipline its police officers and firefighters. We reject this argument.
“A home rule city derives its power not from the Legislature but from section 143.057 of the Civil Service Act does not unconstitutionally infringe on the City’s home rule authority to discipline its police officers.
The City argues that section 143.057(d) is an unconstitutional delegation of legislative authority because it does not provide sufficient standards to inform the AAA and the FMCS how to determine which arbitrators are “qualified” and “neutral” and therefore capable of serving as hearing examiners. We also reject this contention.
As a preliminary matter, we turn to petitioners’ contention that the City’s argument is a due process challenge that the City lacks standing to assert because municipalities do not enjoy due process rights. See Nootsie, Ltd., 925 S.W.2d at 662. “This interest provides the [City] with a sufficient stake in this controversy to assure the presence of an actual controversy that the declaration sought will resolve.” Id.
In examining the delegation, the parties treat both the AAA and the FMCS as private entities, when in fact the FMCS is an independent federal agency. See Texas Boll Weevil Eradication Found., Inc. v. Lewellen, 952 S.W.2d 454, 469 (Tex.1997) (“[W]e believe it axiomatic that courts should subject private delegations to a more searching scrutiny than their public counterparts.”). Because the parties do not address this issue, we will review both delegations under the standard applicable to private entities. Only if the delegation to the FMCS fails under that test would we need to decide whether a more deferential standard is warranted.
The non-delegation doctrine of 960 S.W.2d 617 (Tex.1997).
We recently considered the constitutionality of a private delegation of legislative authority in section 143.057(d) impermissibly delegates legislative authority to private entities to decide what qualifications an impartial hearing examiner must possess, we apply the eight-factor test set out in Boll Weevil:
1. Are the private delegate’s actions subject to meaningful review by a state agency or other branch of state government?
2. Are the persons affected by the private delegate’s actions adequately represented in the decisionmaking process?
3. Is the private delegate’s power limited to making rules, or does the delegate also apply the law to particular individuals?
4. Does the private delegate have a pecuniary or other personal interest that may conflict with his or her public function?
5. Is the private delegate empowered to define criminal acts or impose criminal sanctions?
6. Is the delegation narrow in duration, extent, and subject matter?
7. Does the private delegate possess special qualifications or training for the task delegated to it?
8. Has the Legislature provided sufficient standards to guide the private delegate in its work?
AAA or FMCS.” 950 S.W.2d at 754. However, a delegation challenge requires a more comprehensive review.
Thus, we consider all eight factors, keeping in mind that if it is possible to interpret the language of the statute in a manner that renders it constitutional, we must do so. See TEX. GOV’T CODE § 311.021(1).
Before applying the factors, it is important to focus on the issue the City frames. The City does not contend that the Legislature impermissibly delegated authority to hear appeals to a private decisionmaker. While this broader delegation of authority was discussed in amici briefs submitted by the cities of Marshall, Amarillo, and Garland, and suggested at the oral argument of this case, it was not a part of the City’s case either in the courts below or here. Instead, the City asserts only that the Legislature has failed to provide adequate guidelines for the AAA and FMCS to follow in choosing “qualified neutral arbitrators” to serve as hearing examiners. As such, we review only the delegation of authority to determine which arbitrators are qualified and neutral.
Meaningful Governmental Review
The first factor weighs against the delegation. The AAA or FMCS’s selection of the seven arbitrators submitted to the parties is not subject to any meaningful review. From the statutory text, it does not appear *736 that any governmental branch or body could review a claim that the hearing examiners provided by AAA or FMCS on the list of seven are not qualified or neutral, or are otherwise undesirable to a party.2 See § 143.057(d). This right is somewhat constrained by the fact that, in the end, one of those on the list will be selected, even if one or both parties are not satisfied with that individual. Id.
Adequate Representation of Affected Persons
The second factor weighs in favor of the delegation. While the parties do not have a say in determining which arbitrators are submitted for their consideration, they are actively involved in choosing which arbitrator from the list supplied will serve as their hearing examiner. Importantly, the statute provides that the parties are free to agree on an impartial hearing examiner without resort to the AAA or FMCS. § 143.057(d). If the parties cannot agree within the specified time period, the City must request a list of seven candidates from either AAA or FMCS. Id. The parties can then either agree on one of the listed candidates, or choose the hearing examiner by alternately striking names from the list, with the remaining name serving as the hearing examiner. Id. Taken as a whole, this procedure provides the parties adequate participation in the selection of their hearing examiner.
Delegation of Rule Application as well as Rule–Making
The third factor also weighs in favor of the delegation. Neither the AAA nor the FMCS are involved in making rules or in applying the law to particular individuals. Their delegation is limited to nominating or recommending individuals, the antithesis of the broad delegation which this factor disfavors.
Conflict of Interest
The fourth factor weighs in favor of the delegation. Both the AAA and the FMCS are highly respected entities with expertise in the area of arbitration.3 These delegates have no private interest at stake.4 The City seems to believe that these entities are, by necessity, biased in favor of the disciplined officers because it is the officer who chooses to have an appeal heard before an independent hearing examiner. It is likely a perception of bias in favor of the City, on the part of the Civil Service Commission, that prompts officers to request that their appeal be heard under § 143.057(d). This provision provides the City with additional input in the selection process, countering the police officer or fire fighter’s ability to unilaterally opt for an independent hearing examiner. Therefore, the statute strikes a balance, and neither the AAA nor the FMCS would gain from alienating or favoring either side of the dispute.
The fifth factor weighs in favor of the delegation. The AAA and FMCS have *737 no power to impose criminal sanctions or define criminal acts. As mentioned above, their function is limited to supplying lists of arbitrators for the parties’ consideration.
The sixth factor weighs in favor of the delegation. The delegation is narrow in duration, extent, and subject matter. The AAA and the FMCS serve as nominating bodies. Their only role is to prepare a list of qualified persons from which the parties select the arbitrator who will serve as their hearing examiner. See § 143.057(d). Under these circumstances, the authority to determine which arbitrators are neutral and qualified is sufficiently narrow.
Special Qualifications or Training
The seventh factor weighs in favor of the delegation. The AAA and the FMCS are specialized entities with acknowledged expertise in selecting appropriately trained arbitrators to serve in particular cases. We have found statutes from twenty-eight jurisdictions providing for the selection of arbitrators or hearing examiners from lists provided by the AAA or the FMCS. See WYO. STAT. ANN. § 12–9–115 (Michie 1997).
Finally, contrary to the court of appeals’ conclusion, we believe the eighth factor weighs in favor of the delegation. The specific statutory standard provided is that the names are to be those of “qualified neutral arbitrators.” Edgewood Indep. Sch. Dist. v. Meno, 917 S.W.2d 717, 740–41 (Tex.1995).
The Legislature enacted the Civil Service Act for the express purpose of “secur[ing] efficient fire and police departments composed of capable personnel who are free from political influence and who have permanent employment tenure as public servants.” Housing Auth. of City of Dallas v. Higginbotham, 135 Tex. 158, 143 S.W.2d 79 (1940)).
While we recognize that legislative action is not without bounds, section 143.057(d) is not an overly broad delegation of legislative authority. Likewise, we find the legislative limitation on the City’s ability to discipline its police officers constitutionally permissible. Accordingly, we reverse the judgment of the court of appeals and reinstate the trial court’s judgment.
Unless otherwise indicated, all references are to the Texas Local Government Code.
The statute provides for judicial review of the hearing examiner’s award only on jurisdictional grounds or on allegations of “fraud, collusion or other unlawful means.” § 143.057(j).
The American Arbitration Association, founded in 1926, is a public-service, not-for-profit organization offering a broad range of dispute resolution services through offices located in major cities throughout the United States. The Federal Mediation and Conciliation Service was created by Congress as an independent agency to further the national labor policy. 29 U.S.C.A. § 171. FMCS’s role is to assist parties and industries affecting commerce to settle their labor disputes through conciliation, mediation, and arbitration.
The FMCS does not charge an administrative or filing fee for furnishing arbitration services. The AAA prescribes an administrative fee schedule to compensate it for the cost of providing administrative services.