Before Judges Pressler, Wefing and Parrillo.
The opinion of the court was delivered by: Parrillo, J.A.D.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
On appeal from the Merit System Board, Department of Personnel.
These four appeals, consolidated for purposes of this opinion, present a series of challenges to final administrative decisions of the Merit System Board (Board) granting appointment waivers for various civil service positions after examination and compilation by Jersey City of lists of eligibles and their certifications. Three of the appeals are brought pro se by Patrick Johnston, who was on the list of eligibles for three positions, i.e., Community Service Aide/Senior Clerk, Program Monitor, and Code Enforcement Officer. The fourth appeal is brought by James Ganley, by counsel, challenging the appointment waiver for the position of Code Enforcement Officer. For reasons that follow, we affirm the Board's grant of an appointment waiver for the position of Program Monitor, but reverse its determinations with respect to Community Service Aide/Senior Clerk and Code Enforcement Officer and remand for further proceedings consistent with this opinion.
All four appeals involve common questions concerning the use of eligible lists in the merit system's appointment, selection, and placement process. Some general background is therefore in order. To implement the state constitutional mandate that appointments and promotions in the civil service of the State and its political subdivisions be made according to merit and fitness to be ascertained by competitive examination, N.J. Const. art. VII, § 1, ¶ 2, the Legislature created the Department of Personnel (Department) as a principal department within the executive branch of government and further established the Merit System Board and Commissioner of Personnel as integral parts of the Department. N.J.S.A. 11A:2-1; N.J.S.A. 11A:2-8. The Board has the authority to assign and reassign titles; the Commissioner of Personnel has broad supervisory power to review classification plans governing all positions in the civil service and to provide for examinations testing candidates' ability to perform the duties of a title. N.J.S.A. 11A:2-3 to -7; N.J.S.A. 11A:3-1; N.J.S.A. 11A:4-1 to -16.
Vacancies in the civil service are filled by promotional examination, N.J.S.A. 11A:4-2, which the Commissioner is authorized to announce and administer. N.J.S.A. 11A:4-1(a). The examination process is triggered by either the appointment of a provisional to a civil service position or the appointing authority's request for a list to fill a vacancy. N.J.S.A. 11A:4-5. Based on the outcome of the examination, along with other factors, the Commissioner provides for the establishment, certification, and cancellation of eligible lists of candidates. N.J.S.A. 11A:4-4. Once the examination process has been initiated and there is a complete certification, the appointing authority is required to make appointments from the list, in accordance with the "rule of three"*fn1, "unless otherwise permitted by the Commissioner for valid reason such as fiscal constraints." N.J.S.A. 11A:4-5.*fn2 In other words, it is only under certain limited circumstances that the Commissioner may grant the appointing authority a waiver of the requirement to make the appointment from the eligible list and, therefore, leave the position vacant in the face of a complete list.
In each of the four appeals before us, the Board granted Jersey City's request for a waiver of appointment ostensibly because of the City's fiscal crisis. It appears undisputed that, in July 1999, Jersey City was designated by the State as a distressed city pursuant to N.J.S.A. 52:27D-118.25 and came under the fiscal oversight of the local public finance board within the Department of Community Affairs. On February 9, 2000, Jersey City implemented a reduction-in-force in which thirty-three employees were laid off. With that in mind, we next turn to the individual circumstances surrounding each civil service title at issue here and the Board's decision to leave that position vacant in the face of a complete and certified list.
We approach each instance mindful of our limited role in reviewing administrative action. Matter of Musick, 143 N.J. 206, 216 (1996). In the search for arbitrary or unreasonable action, the judicial role is generally restricted to three inquiries:
(1) whether the agency's action violates express or implied legislative policies, that is, did the agency follow the law; (2) whether the record contains substantial evidence to support the findings on which the agency bases its action; and (3) whether, in applying the legislative policies to the facts, the agency clearly erred in reaching a conclusion that could not reasonably have been made on a showing of the relevant factors. [Ibid. (citations omitted).] See also In re CAFRA Permit No. 87-0959-5, 152 N.J. 287, 304 (1997); Brady v. Board of Review, 152 N.J. 197, 210 (1997); Gloucester Cty. Welfare Bd. v. New Jersey Civ. Serv. Comm'n, 93 N.J. 384, 398 (1983).
By the same token, we are in no way bound by the agency's interpretation of a statute or its determination of a strictly legal issue. Mayflower Securities v. Bureau of Securities, 64 N.J. 85, 93 (1973).
1. In the Matter of Program Monitor (M62780)
On September 22, 1997, Jersey City provisionally appointed Stephen Schulz to the title of Program Monitor, pending an open competitive examination. The provisional appointment generated an examination that was announced in December 1997. On March 12, 1998, an eligible roster was promulgated that contained the names of twelve individuals, including appellant Patrick Johnston, who, without veteran status, tied as the number two-ranked eligible. On June 1, 1999, a complete certification containing the twelve names was issued to Jersey City. Thereafter, Jersey City, through its assistant personnel director, requested of the Board an appointment waiver on the basis that the provisional employee Schulz was no longer working in the Program Monitor position, having resigned effective August 2, 1999, and that the City was not making appointments due to fiscal constraints. On October 13, 2000, the Board granted Jersey City the appointment waiver, finding that the appointing authority had demonstrated a valid reason for not making an appointment from the subject eligible list in light of its designation as a distressed city, its recent reduction in force, and the fact that no provisionals were then functioning in the title.
The fact that the City may have continued to employ persons provisionally in other unspecified titles does not detract from the economic justification for withholding current appointment to the position of Program Monitor, left vacant since August 2, 1999. Communications Workers of America v. State of New Jersey, 191 N.J. Super. 1, 4-6 (App. Div. 1983). The appointing authority retains the discretion to determine which areas of municipal government provide mandatory or critical services and which positions could be eliminated during a fiscal crisis. Melchionne v. Newark, 60 N.J. Super. 104, 121 (App. Div.), aff'd, 33 N.J. 404 (1960); Greco v. Smith, 40 N.J. Super. 182, 189-90 (App. ...