June 26, 2007
GLOUCESTER COUNTY INSTITUTE OF TECHNOLOGY, GLOUCESTER COUNTY, PETITIONER-RESPONDENT,
BOARD OF EDUCATION OF THE LENAPE REGIONAL HIGH SCHOOL DISTRICT, BURLINGTON COUNTY, RESPONDENT-APPELLANT.
On appeal from a final decision of the State Board of Education, EDUOS-4720-00.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Submitted June 6, 2007
Before Judges Winkelstein and Baxter.
Appellant, the Board of Education of the Lenape Regional High School District (Lenape District), appeals from a determination of the State Board of Education (State Board) affirming the right of the Gloucester County Institute of Technology (GCIT) to exclude post-secondary students from the formula it used to calculate the fee the Lenape District was required to pay to GCIT for out-of-county students who attended GCIT. We affirm substantially for the reasons expressed by the Acting Commissioner of Education (Commissioner) in her October 11, 2005 decision, which the State Board affirmed on March 3, 2006.
GCIT operates the Southern New Jersey Academy of Performing Arts program for students who pursue careers in the performing arts. The Lenape District is located in Burlington County, and is comprised of four high schools. GCIT seeks payment from the Lenape District of nonresident fees for forty-five students who attended GCIT's academy program during the school years 1997-1998 through 2004-2005.
In 1998, GCIT petitioned the Commissioner, seeking tuition payments for nine students from the Lenape District who were attending GCIT. At that time, the Lenape District claimed that GCIT did not meet the definition of vocational education. After the case was transferred to the Office of Administrative Law (OAL), the Administrative Law Judge (ALJ) concluded that the academy program was approved vocational education; the Commissioner subsequently adopted, in substantial part, the ALJ's decision.
The State Board remanded the matter to the Commissioner for findings consistent with the State Board's March 1, 2000 decision in a companion case. K.B. ex rel H.B. v. Bd. of Educ. of the Rancocas Valley Reg'l High Sch. Dist., No. A-6814-02 (App. Div. Nov. 12, 2004), certif. denied, 182 N.J. 431 (2005). Following the decision by this court in K.B., supra, that the academy program constituted "vocational education," the ALJ again concluded that the GCIT nonresident fee calculation was appropriate. The Commissioner adopted the ALJ's recommendation and directed the Lenape District to remit payment to GCIT, including an unpaid balance on the nonresident fee and interest on the undisputed amount. The State Board affirmed the Commissioner's decision.
The facts are not in dispute. The issue is whether the governing law and regulation require the inclusion of post-secondary vocational students for purposes of calculating the non-resident fee. In addressing this issue, the ALJ, in his August 26, 2005 decision, made the following findings:
N.J.S.A. 18A:54-20.1(c) does not allow an institution like GCIT to collect tuition from a school district like Lenape for students that have graduated from high school and are no longer the responsibility of the home district. The question here, however, is whether GCIT must include in-county post-secondary students in attendance at its programs, when calculating the non-resident fee for out-of-county secondary students. The better rational[e] . . . is that the regulatory scheme would choose to compare like categories. Thus the non-resident fee for out-of-county secondary students would be based on secondary students in attendance at GCIT.
The ALJ observed that the Legislature and the State Board used the same non-resident fee language for county special services districts, which do not have post-secondary students. Accordingly, he reasoned that the parallel language in the two statutes showed that post-secondary students were also not contemplated in N.J.S.A. 18A:54-20.1(c). He imposed prejudgment interest beginning March 1, 2005, thirty days from the date of the Supreme Court's denial of certification in K.B. In adopting the ALJ's findings, the Commissioner stated:
With respect to the central question of this matter, the Commissioner concurs with the ALJ that [GCIT] did not err by omitting nonresident post-secondary students from its calculation of the nonresident fee authorized by N.J.S.A. 18A:54-20.1(c). Notwithstanding [Lenape District's] focus on the construction of particular words and phrases, it is clear from the overall statutory and regulatory scheme governing support of county vocational schools -- as well as sound in terms of educational and fiscal policy -- that the nonresident fee is intended to generate for out of county students the same level of support that the school's county of location provides for resident students.
The Commissioner observed that post-secondary county vocational education for nonresidents is governed by its own separate statutory scheme, N.J.S.A. 18A:54-23.1 to -23.5, and that post-secondary costs are wholly covered by the State, while secondary costs are covered by the county.
The Commissioner also agreed with the ALJ that "there was no reason why [Lenape District] should not have paid at least the undisputed amount due to GCIT, as it represents it now has" and directed appellant to pay prejudgment interest on the undisputed amount, $257,042.22, from the March 1, 2005 date established by the ALJ until the date that the funds were disbursed.
Appellate review of an agency decision is limited. In re Taylor, 158 N.J. 644, 656 (1999); I.L. v. N.J. Dep't of Human Servs., 389 N.J. Super. 354, 364 (App. Div. 2006). When reviewing an agency's interpretation of its own regulation, a court "must give substantial deference to the agency unless its interpretation is inconsistent with the governing legislation." In re Freshwater Wetlands Prot. Act Rules, 180 N.J. 415, 441 (2004) (Zazzali, J. concurring). Administrative regulations enjoy a presumption of validity and the person attacking them has the burden of proving their invalidity unless they are clearly ultra vires. St. Peter's Univ. Hosp. v. Lacy, 185 N.J. 1, 13 (2005). Courts will give great deference to an agency's interpretation and implementation of rules it makes to enforce the statutes for which it is responsible. Ibid. Deference is afforded because the "agencies have the specialized expertise necessary to enact regulations dealing with technical matters and are 'particularly well equipped to read . . . and to evaluate the factual and technical issues that . . . rulemaking would invite.'" Ibid. (quoting In re Freshwater Wetlands Prot. Act Rules, 180 N.J. 478, 489 (2004)).
Courts also give substantial deference to the interpretation an agency gives to a statute that the agency is charged with enforcing. R & R Mktg., L.L.C. v. Brown-Forman Corp., 158 N.J. 170, 175 (1999) (internal quotations omitted); In re Contest of the Democratic Primary Election of June 3, 2003 for Office of Assembly of Thirty-First Legislative Dist., 367 N.J. Super. 261, 281 (App. Div. 2004). "[I]f a statute is silent or ambiguous with respect to a specific issue, reviewing courts should look to the interpretation of the agency administering that statute." In re RCN of NY, 186 N.J. 83, 92 (2006). Even if statutes are ambiguous, and the Legislature has not addressed the precise question of statutory meaning, [a reviewing court] may not simply impose [its] own construction on the statute, as would be necessary in the absence of an administrative interpretation. Rather, if the statute is silent or ambiguous with respect to the specific issue, the question for the court is whether the agency's answer is based on a permissible construction of the statute.
To uphold an agency's construction of a statute that is silent or ambiguous with respect to the question at issue, a reviewing court need not conclude that the agency construction was the only one it permissibly could have adopted, or even the reading the court would have reached if the question initially had arisen in a judicial proceeding. [Kasper v. Bd. of Trs. of the Teachers' Pension and Annuity Fund, 164 N.J. 564, 581 (2000) (internal quotation omitted).]
The court will defer to the agency interpretation, then, as long as it is not "plainly unreasonable." Matturri v. Bd. of Trs. of the Judicial Ret. Sys., 173 N.J. 368, 382 (2002).
Nevertheless, an agency may not, "'under the guise of interpretation . . . give a statute any greater effect than its language allows,'" In re Freshwater Wetlands Prot. Act Rules, supra, 180 N.J. at 489 (quoting In re Valley Rd. Sewerage Co., 154 N.J. 224, 242 (1998) (Garibaldi, J., dissenting)), and a regulation will be set aside if it is "'inconsistent with the statute it purports to interpret.'" Id. at 489 (quoting Smith v. Dir., Div. of Taxation, 108 N.J. 19, 26 (1987)).
The statute at issue is N.J.S.A. 18A:54-20.1(c). It empowers county vocational school districts to charge sending districts a fee for out-of-county pupils in attendance. It reads:
The board of education of a county vocational school district shall receive such funds as may be appropriated by the county pursuant to [N.J.S.A.] 18A:54-29.2 and shall be entitled to collect and receive from the sending districts in which each pupil attending the vocational school resides, for the tuition of that pupil, except for a post-secondary vocational education pupil, a sum not to exceed the actual cost per pupil as determined for each vocational program classification, according to rules prescribed by the commissioner and approved by the State board. Whenever funds have been appropriated by the county, the county vocational school district may charge a fee in addition to tuition for any pupils who are not residents of the county. The fee shall not exceed the amount of the county's per pupil appropriation to the county vocational school district. [N.J.S.A. 18A:54-20.1(c).]
The regulation, N.J.A.C. 6A:23-3.3(d)(1), prescribes the formula for calculating the nonresident fee to be charged to sending districts for students attending a county vocational school. The version of the regulation in effect at the time of the ALJ's decision, read, in pertinent part, "The fee per nonresident student is not to exceed the amount obtained by dividing the county appropriation by the number of students who are residents of the county pursuant to N.J.S.A. 18A:54-20.1."*fn1
Giving deference to the agency, the Commissioner's construction of the statute and regulation was reasonable in the context of the statutory scheme. The statute and regulation in effect at the time did not include post-secondary students for purposes of the calculations. As the Commissioner pointed out in her October 11, 2005 decision, where other statutes and regulations reference post-secondary students, they do so in explicit terms; those terms are absent here.
Also notable is that the recent amendment to the applicable regulation, which was adopted after the ALJ's decision, specifically excludes post-secondary education students from the fee calculations. While not binding, "'[s]ubsequent legislation declaring the intent of an earlier statute is entitled to great weight in statutory construction.'" Cont'l Gypsum Co. v. Dir., Div. of Taxation, 19 N.J. Tax 221, 231 (Tax 2000) (quoting Red Lion Broad. Co. v. FCC, 395 U.S. 367, 380-81, 89 S.Ct. 1794, 1801, 23 L.Ed. 2d 371, 383 (1969) (footnote omitted)).
Accordingly, we affirm substantially for the reasons expressed by the Commissioner's decision, as adopted by the State Board. We agree that N.J.A.C. 6A:23-3.3(d)(1) does not include post-secondary students for purposes of calculating the nonresident fee.