Batman, Appropriations, and “Augmentation”

My co-author James has made a few posts already this week, and I’d like to thank Professor Volokh for the opportunity to participate here. I’m going to chip in with a post about Batman based on the last few issues of Detective Comics vol. 1, # 871-881. Number 881 is actually the very last issue before the “New 52″ renumbering/revamp/reboot DC Comics did at the end of 2011. The issues in question are collected in trade paperback form. The legal issue we’ll be looking at has to do with government appropriations law. Specifically: is it legal for Bruce Wayne/Batman to donate a privately-funded forensics lab to the Gotham City Police Department?

The background is that, in the aftermath of his return after the events of Final Crisis, Batman decided to start up franchises around the world. This is reflected in Batman, Incorporated, a title which survived the New 52 revamp and continues in its monthly format. But realizing that Gotham City might feel somewhat slighted if Batman simply expanded his activities without giving Gotham any special attention, Bruce Wayne decided to give the G.C.P.D. a fully-equipped, state-of-the-art forensics lab. But because of the somewhat fraught relationship between Batman and the Department, G.C.P.D. does not make routine use of the facilities and only seems to do so when they’re dealing with a super criminal. Regardless, the question for our purposes is whether this kind of arrangement is legally permissible.

I. Federal Appropriations

If the G.C.P.D. were a federal agency, the answer would be “Definitely not.” The Antideficiency Act (31 U.S.C. § 1341) explicitly prohibits an officer or employee of the United States from “mak[ing] or authoriz[ing] an expenditure or obligation exceeding an amount available in an appropriation or fund for the expenditure or obligation”. In other words, federal agencies may spend only money specifically authorized by Congress in a duly enacted statute. Going outside the budget process is known as “augmentation” in the appropriations world, and the GAO actually has a section devoted to it in its Principles of Federal Appropriations Law, Vol. II (3d ed.). The relevant section starts on page 6-162. And Congress does care about this, as evidenced by the recent kerfluffle over Secretery of HHS Kathleen Sebelius allegedly seeking donations from private entities. Looks like she was actually soliciting donations for non-governmental non-profits rather than HHS itself, but because said non-profits may act to take some of the load off HHS to implement the ACA, the issue is at least arguably murky. True, giving equipment is not precisely the same thing as giving money and is thus not categorically prohibited by the text of the statute, but the GAO materials indicate that they adopt a function over form perspective and take a dim view of even de minimis donations.

Why the Antideficiency Act? Well the main reason is simply to stop executive agencies from running spending money they don’t have. Hence the name of the act. If Congress hasn’t decided to run a budget deficit, the President isn’t allowed to run that on his own. In this sense, the Antideficiency Act is simply an implementation of U.S. Const., Art. I, sec. 9, cl. 7, which is said to give Congress the exclusive “power of the purse”. But implicit in that text is the idea that Congress, and only Congress, gets to decide how much money the federal government is going to spend. This power is what gives Congress one of its most significant powers over the Executive Branch: Congress has the power to completely defund any activity it doesn’t like. Permitting the other branches to do an end-run around this legislative power through the raising of funds and equipment from third parties would represent a significant disruption in our system of checks and balances.

More generally though, there may be good reasons to be suspicious of government agencies that depend on contributions from private actors for their funding. Imagine the conflicts of interest that might arise in, say, Pfizer donating funds to the FDA for new lab space, or Monsanto contributing to the EPA’s pesticide regulation program. Such contributions might prejudice the administrative process not only towards industry in general, but towards particular companies who contribute more than others. The concise term for such donations is “bribes”.

Fortunately, this doesn’t really seem to be a problem at the federal level. The GAO publishes a report of its Antideficiency Act investigations, and from the look of it, they mostly involve what amount to bookkeeping errors. For instance, the GAO investigated the SEC for an alleged $810 million violation which had to do with the way multi-year leases are accounted for.

II. State and Local Appropriations

But for whatever reason, the states mostly do not seem to have adopted a version of the Antideficiency Act, at least not with respect to local governments. Or, rather, “anti-deficiency” means something else entirely in the state law context (i.e., whether a creditor may pursue a debtor for any deficiency remaining after a foreclosure sale). But state and especially local governments routinely solicit and receive donations from private individuals and entities. Many police reward funds are made with donations. Public libraries are looking for donations all the time. The concept of volunteer fire departments, where significant portions of the department’s labor are provided by volunteers (firefighters receiving a mostly nominal compensation) would arguably be prohibited volunteer services 31 U.S.C. § 1342 as an “ongoing, regular function of government”. Why do state and local governments do this while the federal government does not, and should we be worried about it?

As to the first, the obvious answer is that while the federal government is a government of limited powers subject to the entire U.S. Constitution, state governments are governments of plenary powers subject to their own constitutions. The states may do all sorts of things that the federal government may not, and that includes the creation and regulation of political subdivisions and the adoption of policies with respect to “augmentation”.

As to the second, that’s a bit more complicated. Outright corruption at the federal level is remarkably rare, especially when compared to many foreign countries where it’s simply a way of life. But corruption at the state and especially local level is far more widespread, and convictions there are depressingly routine. But I would draw a distinction between outright bribery — which is illegal at every level of government — and the kind of systemic influence that might arise from the donation of significant quantities of money or equipment to federal agencies without any actual bribes.

For one thing, local government agencies frequently do not have the kind of regulatory authority which would lend themselves to this sort of thing. Kickbacks aside, donating to a local fire department or library is not something which could plausibly lead to a business advantage in most cases, because those agencies can’t really confer regulatory benefits in the same way that many federal agencies can. Donations to a police department might be slightly more problematic, but even there the potential for abuse is pretty narrow. It would be bad for rich kids to be released from custody without charges because their parents make donations, but (1) that’s probably already an illegal bribe, and (2) it just doesn’t seem to be the same kind of systemic conflict of interest caused by regulated entities funding their own regulators.

Further, while Congress frequently attempts to rein in a hostile executive with funding limitations and so jealously guards against “augmentation,” things are different on the local level. From a legal/constitutional standpoint, many local governments have little in the way of separation of powers, with the local council/board having both legislative and executive power. Legislative control over executive spending isn’t part of that system of government in many municipalities. From a practical standpoint, every federal agency always thinks it needs more money, but local governments are hard up for funds in ways that federal agencies just aren’t. This sort of thing doesn’t happen with the feds. Most local legislatures would absolutely love to spend more money if they could find it — indeed, unfunded liabilities are an enormous problem for state and local governments across the country — so they tend not to care as much about the use of outside funds.

Donations to state and local governments, whether in the form of cash, equipment, or services, are generally legal, if potentially ethically fraught (at least in theory).

III. Conclusion

So is it legal for Bruce Wayne to simply give a new forensics lab to the G.C.P.D.? Probably. Because Gotham City is a municipality and thus a political subdivision of whatever state it happens to be located in, this kind of thing is actually pretty routine. This would represent a gift on the extravagant end of things, but not by all that much, I’d wager. But it’s a good thing we aren’t talking about the federal government, because donations there are legally problematic. The Antideficiency Act prohibits the use of funds not appropriated by Congress, and the courts–and Congress–are going to take a dim view of attempts to avoid the Act by the contribution of non-cash alternatives. So Batman is okay here. But unless Congress authorized the use of the Iron Man armor, much of the story arc of Iron Man 2 and 3 rests on a questionable legal foundation.