Separation of Powers:An Old Doctrine Triggers a New Crisisby John V. Orth

"The only prize much cared for by thepowerful is power. "

- Oliver Wendell Holmes

On January 12, 1982, the N.C. Supreme

Court handed down a decision that hastriggered a virtual constitutional crisisin state government. The state's highest

judicial panel ruled that the legislature cannotappoint its own members to the EnvironmentalManagement Commission (EMC), a regulatorybody in the executive branch, because suchappointments violate the separation of powersprovision of the North Carolina Constitution. "Itis crystal clear to us," the landmark decision read,"that the duties of the EMC are administrative orexecutive in character and have no relation to thefunction of the legislative branch of government,which is to make laws." 1

In rapid-fire sequence, the Governor, the legis-lative leadership, the Attorney General, and theSupreme Court Justices themselves issued a seriesof memos, letters, opinions, and position state-ments on how the separation-of-powers conceptaffects the day-to-day functioning of state govern-ment. The various documents, of both an officialand informal nature, questioned the very existenceof the most fundamental bodies in state govern-ment - from the Advisory Budget Commission,the principal budgetary vehicle for governors andlegislators since 1925, to the Joint LegislativeCommittee to Review Block Grant Funds, a groupcreated just last October to deal with the ReaganAdministration initiative in consolidating federally-funded programs.

The first three months of 1982 may well berecorded as the period that permanently alteredthe way in which North Carolina's government isorganized (see chronology of events on pages 38-43). In their June 1982 fiscal session, the law-makers will begin to sort out the various legal andadministrative questions. Related court cases,administrative rulings, and legislative actions aresure to follow.

What exactly did take place during this periodregarding the separation of powers of the threebranches of government? And why are the variousevents interrelated? Most importantly, how willthese events affect the future of North Carolina'sgovernment?

An American Tradition

America's founding fathers, having just led aviolent revolution against the excesses of the

British king and parliament, feared concentrationsof power. Consequently, in the U.S. and stateConstitutions, they limited the powers of govern-ment and divided them among the executive,legislative, and judicial branches. This separationof powers took two forms: a "vertical" separationbetween the federal and state levels of government;and a "horizontal" separation on both the stateand federal levels among the legislative, executive,and judicial branches.

Not only were the powers separated among thethree branches, but the individuals exercising themwere separated as well. The N.C. Constitution, forinstance, prohibits a person from holding a federaland state office at the same time. Within the state,no person may fill two elective offices, such as alegislative seat and a judgeship, at the same time.Finally, no one in the state may hold two or moreappointive offices or any combination of electiveand appointive offices, unless the legislaturespecifically authorizes it.

To provide an effective mechanism for regulat-ing disputes over which branch should controlwhich governmental powers, the founding fathersset one branch against another through a system of"checks and balances." Within this system, thethree branches of government operate in a perman-ent and profound interdependence. Consider theseexamples in North Carolina:

• the legislature enacts laws which the executivebranch must administer;

• the lieutenant governor is second-in-commandof the executive branch and also presides over thestate Senate;

• the governor and the Advisory Budget Com-mission (which by law has at least eight legislativemembers) propose a budget to the legislature; thelegislature adopts a budget which is administeredby the governor;

• the attorney general, elected directly by thevoters, serves as counsel for both the executive andlegislative branches; the legislature funds the De-

John V. Orth is an associate professor of law at theUniversity of North Carolina School of Law at ChapelHill. He holds a law degree and doctorate in history fromHarvard and clerked for Judge John J. Gibbons of theUnited States Court of Appeals for the Third Circuit.

36 N.C. INSIGHT

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partment of Justice, headed by the attorneygeneral;

• the judiciary has the power to review the actsof the legislative and executive branches; the legis-lature determines the structure and budget of thejudiciary and creates new judgeships; the governorfills judicial vacancies and appoints persons to newjudgeships.

As the size and scope of state government hasgrown in recent years, the interdependence of thethree branches has increased. For example, legisla-tors now hold more than 200 positions on 90boards, commissions, and councils in the executivebranch; 50 of these groups have been created inthe last eight years.2

Even as government grows and interdependenceincreases, the 18th-century philosophy of thefounding fathers retains a powerful influence.Throughout the history of the republic, the wis-dom of the framers of the federal and state consti-tutions has reasserted itself as the rationale forlandmark judicial decisions. The recent ruling bythe N.C. Supreme Court regarding the Environ-mental Management Commission (Wallace v. Bone)has dramatized once again the power of longstand-ing constitutional principles. In its declaration, thehigh court relied on language in the N.C. Constitu-tion that could hardly be more plain: "The legisla-

tive, executive, and supreme judicial powers of theState government shall be forever separate anddistinct from each other."3

The Judiciary Breaks a Logjam

The EMC decision illustrates a critically impor-tant fact about the tripartite nature of boththe federal and state governments: The buck oftenstops at the courthouse. Relying on judicial prece-dents and constitutional principles, the appellatecourts often interpret legislative and executiveactions. This process catapults the judiciary into apolicymaking role, a role that can break logjamsof controversy (see "The Role of the Judiciary inMaking Public Policy," N. C. Insight, Vol. 3, No. 1).

When the controversy concerns the respectivepowers of the different branches of government,the judiciary functions as a kind of policeman,"checking and balancing" the other two branches.Before the EMC decision, a series of legislative andexecutive assertions of power had built into a log-jam of interdependence, burying beneath it theconstitutional requirement of "forever separateand distinct" branches of government. When theSupreme Court issued the Wallace v. Bone opinionin January, it unleashed a torrent of questions thathad lain unanswered behind the logjam. At least

MAY 1982 37

six legislative and executive trends are now underscrutiny because of the clarity of the Bone decision.

1. Legislative Incursion in Executive -BranchBoards, Commissions , and Councils . In 1980, thelegislature enlarged the membership of the Envi-ronmental Management Commission (EMC) from13 to 17 and required that two House members bechosen by the speaker of the House and twoSenators be selected by the lieutenant governor (inhis capacity as president of the Senate); thegovernor appoints the other 13. Placing fourlegislators on the EMC by statute, the legislaturegave itself a say in the day-to-day operations of theEMC, a regulatory body in the Department ofNatural Resources and Community Developmentwhich makes decisions on everything from pollu-tion standards to dam-building.

In February 1981, four of the non-legislativemembers of the EMC challenged the constitution-ality of the statute. Eleven months later, the N.C.Supreme Court ruled in their favor, striking downthe part of the statute adding legislators to theEMC. The Bone decision affects all other similarlyconstituted commissions. Consequently, actions ofsome 90 groups, including powerful bodies like theAdvisory Budget Commission and the Board ofTransportation, could be challenged if legislatorscontinue participating as voting members of theseexecutive-branch groups (see box on page 46 for alist of the 36 groups most affected by the ruling).

The ruling might also affect other types of legis-lative appointments. The governor has chosen to

Separation of Powers

Landmark Even is

in North Carolina

Compiled by Lacy Maddox

1925 - General Assembly creates the AdvisoryBudget Commission (ABC) (G.S. 143-1et seq).

1929 - General Assembly authorizes governor totransfer budgeted funds within depart-ments (G.S. 143-23).

1970 - Voters ratify third North Carolina consti-tution. First two said the three branches

appoint legislators to 45 positions on 32 groupswith functions similar to those of the EMC; doesthe Constitution prohibit this form of dual officeholding (as legislator and board member)? A num-ber of statutes provide for various legislative leadersto make appointments to boards, commissions,and councils; are appointments of non-legislatorsmade by legislative leaders now under question?Finally, must judges serving on state commissionsresign their appointive posts?

On January 26, 1982, Speaker of the HouseListon B. Ramsey asked Attorney General RufusL. Edmisten for an opinion on whether legislatorscan serve on executive-branch boards and commis-sions in an ex officio, non-voting capacity. OnFebruary 1, Edmisten wrote Ramsey that "wherethe board or commission exercises a part of theadministrative or executive sovereign power of theState, a legislator may not serve in any capacity onthat board or commission."4 On February 19,Edmisten sent a five-page letter to all legislatorsoutlining his opinion regarding the impact of theBone decision and including a list of 41 boards andcommissions. He suggested that all legislators -"regardless of how or by whom appointed" -should resign from those 41 groups. "Should youcontinue to remain on the board or commission,"Edmisten went on to say, "it is my opinion thatany action taken by that board or commissionwill be subject to question." Edmisten also advisedfive judges to remove themselves from three statecommissions (Governor's Crime Commission,

of government "ought to be foreverseparate and distinct ." The 1970 consti-tution changes this provision to "shall beforever separate and distinct" andstrengthens the governor's powers regard-ing administering the state's budget(emphasis added in both sentences).

1975 - General Assembly creates Joint Legisla-tive Commission on Governmental Oper-ations " which shall conduct evaluativestudies of the programs, policies, prac-tices and procedures of the variousdepartments, agencies and institutions ofState government" (G.S. 120-73).

1977 - General Assembly establishes the Ad-ministrative Rules Review Committee(ARRC) and empowers it to consider allregulations promulgated by state agen-cies under the N.C. AdministrativeProcedures Act. Under this statute, if theARRC finds that a regulation is beyondan agency's statutory authority, theARRC must report its objection to theLegislative Research Commission, whichmay report back to the full legislature

Lacy Maddox is research coordinator for the N. C.Center for Public Policy Research.

38 N.C. INSIGHT

N.C. Criminal Justice and Education TrainingStandard Commission, and Art Museum BuildingCommission).

In taking such an aggressive stance, Edmistenhas brought bristles to the backs of some powerfullegislators. Sen. Kenneth C. Royall, Jr., chairmanof the Advisory Budget Commission and Senatemajority leader, charged that "Edmisten has `gonecrazy' in his efforts to get legislators to complywith recent Supreme Court rulings," reported theNews and Observer of Raleigh on February 28.The News and Observer went on to say that Gov.Hunt "has carefully left the dirty work of inter-preting [the court decisions ] to Edmisten." WhileEdmisten has taken the lead on requesting that thelegislators resign, Hunt says that "if the AttorneyGeneral recommends that the legislators resign, Icertainly think that's what we ought to do."

2. Legislative Incursion into the ExecutiveBudget Powers. In its budget session in October1981, the General Assembly took two actions inan effort to broaden its control over budgetarymatters. First, it required the executive branch togain prior approval from the Joint LegislativeCommission on Governmental Operations - acommittee of 13 legislators and the president ofthe Senate - for any executive transfer of morethan 10 percent of the money from one budgetline item to another.5 Since 1929, the governorhad been authorized by statute to transfer bud-geted money within departments.' The legislaturehad created the Commission on Governmental

with recommendations for action (G.S.120-30.26 et seq.).

June - Sen Julian Allsbrook (D-Halifax) files a1979 bill to abolish the ABC on the grounds

that it violates the N.C. Constitution'sseparation of powers provison. No actiontaken on bill.

Aug. - Sen. I. Beverly Lake, Jr. (D-Wake) files a1979 lawsuit challenging the constitutionality

of the ABC. Lake later withdrew thesuit.

March - "The Advisory Budget Commission -1980 Not as Simple as ABC" by Mercer Doty is

released by N.C. Center for Public PolicyResearch. It states that the ABC violatestwo constitutional provisions - separa-tion of powers and governor ' s responsi-bility for the preparation and administra-tion of the budget.

June - General Assembly increases the member-1980 ship of the Environmental Management

Commission (EMC) from 13 to 17,adding two members each from both thestate House of Representatives and thestate Senate [G.S. 143B-283(d)].

Feb. 18 , - Two lawsuits , filed inWake County Super-1981 for Court (consolidated for trial into

State ex rel. Wallace v. Bone ), challengethe constitutionality of the 1980 action

Operations in 1975 to provide for "the continuingreview of operations of State government."' In1975, James E. Holshouser, Jr. - the first Republi-can to be elected governor in the 20th century -headed the executive branch and the Democratscontrolled the legislature. This committee thusbecame a valuable check for legislators during atime of political partisanship between the execu-tive and legislative branches.

Second, the legislature established the JointLegislative Committee to Review Federal BlockGrant Funds. As part of President Reagan's "newfederalism," Congress had enacted a federal budgetthat consolidated large sums of money available tothe states in the form of block grants. The legisla-ture claimed control over the money and grantedits new Block Grant Review Committee the power(when the full legislature was not in session) ofprior approval of any actions proposed to be takenby the governor with respect to the block grants. 8Historically, state executive branches generallyhad administered federal funds that came into astate. But the large new source of funds to be dis-tributed at the state level - the new block grants- stimulated legislative interest throughout thecountry. In North Carolina, the legislature went astep further than did many states, not only estab-lishing a committee to review all block grantactions but also giving that committee the powerof prior approval of any executive action.

After the October session, Gov. Hunt asked theAttorney General to review the two legislative

of the General Assembly adding fourlegislators to the EMC.

March 18,- Wake County Superior Court Judge1981 James H. Pou Bailey, ruling on State ex

rel. Wallace v. Bone, finds that legislativemembership on EMC is constitutional;Bailey reasons that since -legislators are aminority of the EMC, no legislativeattempt was made to usurp executivefunctions.

June 2, - The N.C. Supreme Court allows a direct1981 appeal of Judge Bailey's ruling, bypassing

the N.C. Court of Appeals.June25, - General Assembly increases the powers1981 of its Administrative Rules Review

Committee to review executive rules andregulations (G.S. 120-30.28).

July 8 , - General Assembly establishes the Com-1981 mittee on Employee Hospital and Medi-

cal Benefits and empowers it to adopt ahospitalization and medical insuranceplan for the state's employees , teachers,retired workers, and their dependents,a power formerly exercised by the Boardof Trustees of the Teachers' and StateEmployees' Retirement System (G.S.135-33).

Oct. 10, - General Assembly creates a Joint Legisla-1981 tive Committee to Review Block Grant

MAY 1982 39

actions, and various legal analysts questionedtheir constitutionality (see "Legislators and Gover-nor Clash over Budget Provisions - The LegalIssues at Stake," N.C. Insight, Vol. 4, No. 4).Edmisten provided the Governor with an informal(and therefore unpublished) opinion regarding theactions. But in the wake of the EMC decision,these two budget actions took on added legalsignificance.

On January 19, a week after the Bone decisionwas released , the Attorney General sent a 38-pagelegal memorandum to the Governor, Speaker ofthe House Ramsey, and Lt. Gov. James C. Greenadvising them that both the Block Grant ReviewCommittee's powers and the Commission on Gov-ernmental Operation's new authority over execu-tive transfers of appropriated funds violate thestate constitution. Two days later, Gov. Hunt,Speaker of the House Ramsey, and Lt. Gov. Greensent a formal request for an "advisory opinion" tothe N.C. Supreme Court about the statutes inquestion. (See conclusion section for an explana-tion of such advisory opinions.)

On February 16, 1982, the seven Supreme Courtjustices sent an eight-page advisory opinion toHunt, Green, and Ramsey which said that thelegislative actions violated both the separation ofpowers language in the Constitution (Article I,Section 6), as well as Article III, Section 5(3),which "explicitly provides that `the Governor shalladminister the budget as enacted by the GeneralAssembly."' 9

Funds (G.S. 120 -84.1) and empowersJoint Legislative Commission on Govern-mental Operations to give prior approvalto executive transfer of more than 10percent of appropriated funds in anybudget line item [G.S. 143-23(b)].

Oct. - Gov. James B. Hunt, Jr. asks Attorney1981 General Rufus L. Edmisten for opinion

on constitutionality of legislative actionstaken on October 10, 1981 (see above).

Jan. 12 , - N.C. Supreme Court rules on EMC case,1982 State ex rel. Wallace v. Bone, stating that

the "challenged enactment of the GeneralAssembly violates [separation of pow-ers] section of the state constitution."

Jan. 18 , - Director of Legislative Bill Drafting1982 Gerry Cohen submits a memorandum to

Speaker of the House Liston B. Ramseyregarding Bone decision , which said:"Specific problems may exist for theAdvisory Budget Commission , the JointLegislative Committee to Review FederalBlock Grant Funds, the Joint LegislativeCommission on Governmental Opera-tions, and the Committee on EmployeeHospital and Medical Benefits." Thememorandum outlines problems on var-ious types of legislative appointmentsand presents six alternative methods of

Finally, the justices found that the BlockGrant Review Committee would in some cases be"exercising legislative functions. In those instancesthere would be an unlawful delegation of legisla-tive power."" This finding - that the legislaturecannot delegate full legislative authority to a groupof its members - could affect a broad range ofgroups, from the Advisory Budget Commission tothe Governmental Operations Commission.

The question regarding the budget matters waseasier for the justices to answer than the issueraised in the EMC case. The executive branch'spowers in respect to the budget are spelled out inthe Constitution. The justices did not have to relysolely on the theory of separation of powers butcould be guided as well by the specific constitu-tional provision on the budget.

3. Legislative Incursions into the JudicialBranch. In 1981, the legislature gave the JointLegislative Commission on Governmental Opera-tions (the same committee discussed above regard-ing executive transfer of funds) control over arestricted reserve fund which may affect theexpenditure of funds for judicial personnel. i iThis action may conflict with General Statute 7A-102(a) which gives the Administrative Office ofthe Courts authority to set the number of employ-ees and salaries of personnel in the judicial branchand to perform other fiscal functions. In theNovember/December 1981 issue of the N.C. BarAssociation' s Barnotes , N.C. Superior Court Judge

Jan. 19,1982

Jan. 21,1982

Jan. 21,1982

legislative control over executive branchboards and commissions and the budget.In a 38 -page, legal memorandum, Att.Gen. Edmisten advises Gov. Hunt,Speaker of the House Ramsey, and Lt.Gov. James C. Green that the Joint Legis-lative Commission on GovernmentalOperations' authority over executivetransfers of funds violates three provi-sions of the N.C. Constitution , as Edmis-ten put it : " Separation of Powers,""Governor's budget power," and "im-permissible legislative delegations ofauthority by the General Assembly tolegislative committees" (p. 38).Gov. Hunt, Lt. Gov. Green, and Speakerof the House Ramsey request an advi-sory opinion from the N .C. SupremeCourt regarding the constitutionality ofJoint Legislative Committee to ReviewFederal Block Grant Funds and JointLegislative Commission on GovernmentalOperations' authority over executivetransfer of appropriated funds.Donald B. Hunt, staff counsel to theGovernmental Operations Commission,sends a memo to that committee regard-ing executive branch power to settle suitswhich commit the state to actions (that

40 N.C. INSIGHT

Frank W. Snepp expressed alarm over such actions:"The independence and integrity of the judicialbranch have come under increasing assaults fromthe General Assembly.... This trend must bereversed if the separation of powers between thelegislative and judicial branches of government isto be maintained."

In finding that the Block Grant Review Com-mittee cannot perform the functions granted it,the Supreme Court might well have taken a majorstep towards reversing the trend to which JudgeSnepp refers. In issuing a formal opinion regardingadministration of block grants - an area of conflictbetween the legislative and executive branches -the Supreme Court may also have provided a"check and balance" on the legislature as it affectsthe functioning of the judicial branch. Becausethe Supreme Court found "an unlawful delegationof legislative power" to the Block Grant Commit-tee,12 the Court might find a similar unconstitu-tional delegation of power to the GovernmentalOperations Commission in its authority to controlsome aspects of a restricted reserve fund affectingjudicial personnel.

4. Legislative Committee Taking Over an Exec-utive Agency Program. In July 1981, the GeneralAssembly established its Committee on EmployeeHospital and Medical Benefits and empowered itto adopt a hospitalization and medical insuranceplan for the state's employees, teachers, retiredworkers, and their dependents.13 Formerly, theBoard of Trustees of the Teachers' and State

usually cost money) without legislativeapproval.

Jan. 26, - Speaker of the House Ramsey asks Att.1982 Gen. Edmisten for an opinion on whether

legislators can serve on executive branchboards and commissions in an ex officio,non-voting capacity.

Feb. 1, - Att. Gen. Edmisten , in a six-page legal1982 memorandum, advises Speaker of the

House Ramsey that : " Where the boardor commission exercises a part of the ad-ministrative or executive sovereign powerof the State, a legislator may not servein any capacity on that board or com-mission"

Feb. 1, - State Treasurer Harlan Boyles asks the1982 Attorney General how the Bone deci-

sion affects the Board of Trustees of theTeachers' and State Employees' Retire-ment System, which Boyles chairs, andwhether the Committee on EmployeeHospital and Medical Benefits is consti-tutional (see July 8, 1981).

Feb. 2, - Joint Legislative Committee to Review1982 Federal Block Grant Funds meets. Com-

mittee Co-Chairman, Rep. Al Adams (D-Wake), says the delegation of the legisla-ture's power to this committee is prob-ably unconstitutional but that the com-

Employees' Retirement System, a board withinthe Department of the State Treasurer chaired bystate Treasurer Harlan Boyles, had exercised thisfunction. The legislative committee took quickaction, freezing the benefit levels (effective Sep-tember 30, 1981) available under the currentinsurance contract between Blue Cross/Blue Shieldof North Carolina and the N.C. Teachers' andState Employees' Retirement System, therebygreatly affecting benefits after October 1, 1981.

Following the Bone decision in January 1982,the constitutionality of this committee began tobe questioned. "Specific problems may exist for ...the Committee on Employee Hospital and MedicalBenefits," Director of Legislative Bill DraftingGerry Cohen wrote Speaker of the House Ramseyon January 18, 1982. On February 1, TreasurerBoyles wrote the Attorney General, asking whetherthe legislative committee is unconstitutional.Edmisten responded on February 23 that thestatute creating the Committee on Employee Hos-pital and Medical Benefits is unconstitutional ontwo grounds - separation of powers and delegationof the full legislature 's functions to a committee.

On February 25, the Board of Trustees of theTeachers' and State Employees' Retirement Sys-tem met, and Treasurer Boyles told the group thatthe legislative committee would probably returnpowers for negotiating a new contract to theexecutive branch board. But the same day, Rep.Billy Watkins (D-Granville), co-chairman of thecommittee, and other legislative leaders decided

mittee could make recommendations tothe full legislature.

Feb. 3, - In wake of Bone decision , a group of1982 farmers sue Board of Transportation,

alleging that legislative membership in-validates the Board's decision to runInterstate Highway 95 through theirland. (Citizens for Preserving FarmLand, Inc. P. N.C. Dept. of Transporta-tion, N.C. Board of Transportation).

Feb. 11, - N.C. Center for Public Policy Research1982 releases "Separating the Executive and

Legislative Branches: Boards, Commis-sions, and Councils with LegislativeMembers." It lists 90 boards and com-missions with legislative members, andsays 36 of them violate the separationof powers provision of the state consti-tution (see box on page 46).

Feb. 16, - In response to Hunt/Green/ Ramsey let-1982 ter of January 21, N.C. Supreme Court

issues an "advisory opinion" finding thatthe Joint Legislative Commission onGovernmental Operations' authorityover executive transfer of funds and theJoint Legislative Committee to ReviewFederal Block Grant Funds are uncon-stitutional under Article I, Section 6(separation of powers) and Article III,

MAY 1982 41

that control of the new health insurance contractwould remain with the legislative committee. Inan interview on April 5, Ed Barnes, director of theDivision of Retirement and Health Benefits putit this way: "Our current mode of operation isacting strictly as an administrative staff to thelegislative committee."

Rep. Watkins says the committee will review-bids from insurance companies and recommend anaction to the full legislature. This process mightaccommodate any constitutional questions overdelegating full legislative authority to a committee.However, it may not resolve the separation ofpowers questions. Furthermore, the full legislaturecannot act on a new health insurance contractuntil it meets in June; under that timetable, thenew contract would not go into effect untilOctober 1, 1982.

The current $160 million contract (half ofwhich is paid by the state and half by employeesand retirees) covers some 400,000 people (includ-ing dependents) and is scheduled to expire June 30.As of early April, the old contract had not beenextended for the three months - July, August,and September - during which the new contractwill not be in effect. The separation of powersissue has thus contributed to a degree of uncer-tainty regarding proper administration of one ofthe largest contracts in state government. "It's ahell of a way to run a railroad," Boyles told theBoard of Trustees of the Teachers' and StateEmployees' Retirement System at their February

Section 5 (3) (governor ' s power toadminister the budget). And where theBlock Grant Review Committee exer-cised legislative functions , the Justicesdetermined there "would be an unlawfuldelegation of legislative power."

Feb. 19, - Edmisten writes to all legislators, sug-1982 gesting that those serving on 41 execu-

tive branch boards and commissionsresign from them. The letter also asksthose legislators on the ABC to act in anadvisory capacity only and states thatthe statute creating the Committee onEmployee Hospital and Medical Bene-fits (see July 8, 1981 ) is an unconsti-tutional encroachment on executivebranch powers and, therefore, "nulland void."

Feb. 20 , - Gov. Hunt says he will comply with the1982 Attorney General's request that the

Governor ask the legislators whom heappointed to about 40 boards andcommissions to resign.

Feb. 23 , - Att. Gen . Edmisten writes to Treasurer1982 Boyles (in response to the Boyles' re-

quest of February 1) that the statutecreating the Committee on EmployeeHospital and Medical Benefits is uncon-stitutional on separation of powers and

25 meeting.5. Executive Infringement on the Legislature's

Constitutional Authority to Appropriate Funds.In February 1981, the executive branch settled ahighly controversial suit in federal district court(Willie M. v. Hunt), agreeing that the state wouldidentify violent juveniles who are emotionallydisturbed and would design and operate programsappropriate for this group of youngsters. Whilethe settlement in federal court carried no promiseof a specific amount of money with it (exceptattorneys' fees, which are still being appealed), itdid require the executive branch of the state toundertake substantial new programs - even thoughthe legislature had not appropriated money forthose programs.

In the spring of 1981, the Department ofHuman Resources (DHR) and Department ofPublic Instruction submitted supplemental budgetrequests to the legislature covering "Willie M."services for almost $2 million. In October 1981,DHR returned to the General Assembly with arequest of $2.2 million for Willie M. services. The$4.2 million thus far appropriated by the legisla-ture represents only the beginning of the fullamount necessary to meet the timetable agreedupon between executive agencies, the plaintiffs,and the court. Legislative analysts have estimatedthat the amount could reach $15 million beforethe services are all in place.

Executive agencies have been entering intoconsent judgments for a number of years but

delegation grounds.Feb. 23, - Attorney General writes judges suggest-1982 ing they resign from executive branch

boards and commissions.Feb. 25 , - Director of Legislative Bill Drafting1982 Cohen , at the request of Speaker of the

House Ramsey, reviews the AttorneyGenerals's opinion regarding the 41boards and commissions and recom-mends that Ramsey ask legislative mem-bers to resign from 37 of the 41.

Feb. 25, - The Board of Trustees of the Teachers'1982 and State Employees ' Retirement System

meets. Board chairman, State TreasurerBoyles, says the legislature' s newlycreated Committee on Employee Hospi-tal and Medical Benefits would probablyreturn control over the contracting pro-cedures to the Board in February. TheBoard's two legislative members do notattend.

Feb.25 , - Rep. Billy Watkins (D-Granville), co-1982 chairman of Committee on Employee

Hospital and Medical Benefits , and otherlegislative leaders decide the committeewill retain control of developing a newhealth insurance plan for state employ-ees and teachers and will make recom-mendations in the June session for

42 N.C.INSIGHT

usually for much smaller amounts of money. InHuntley v. Morrow, for example, a case also set-tled in federal court, the consent decree requiredDHR to meet the schedule for appeals establishedby federal regulations on certain public assistancerulings. The consent decree necessitated hiring anew hearing officer, a position for which DHRpreviously had no funds.

Because of the amount of money involved, theWillie M. case began attracting a lot of attentionin 1981. After the Bone decision of January 1982,the funding process triggered by an executive con-sent decree came under further scrutiny. OnJanuary 21, 1982, Donald B. Hunt, counsel to theGovernmental Operations Committee, sent thatcommittee a memo regarding such executive-branch court settlements. Because of the Bonedecision, Hunt wrote, "the General Assemblycannot establish a committee with legislativemembers to decide whether the State will compro-mise a particular suit." But Hunt went on to sug-gest how the legislature could become involved inthe court settlement at an earlier phase of the pro-cess, for example: "filing on behalf of the GeneralAssembly friend of the court briefs in institutionalcases to put before the court the legislature'sview of the impact of the litigation upon thelegislature's power to allocate resources."

The ongoing appropriations process necessaryto meet the Willie M. settlement, taken in thecontext of the Bone decision, dramatizes a dilemmastate officials must face because of the separation

action by the full General Assembly.Feb. 26, - ABC begins to function by making1982 " recommendations to the Governor;"

formerly , the ABC took direct action onbudget requests. Also, the Board ofAwards, a subsidiary panel of the ABCwhich had been responsible for awardingmost state contracts , begins acting in anadvisory capacity.

March 3, - Gov. Hunt says he will assume full au-1982 thority over state budget decisions

which had previously been made by theABC, now acting only in an advisorycapacity.

March 5 , - Speaker of the House Ramsey and Pres-1982 ident Pro Tempore of the Senate Craig

Lawing establish a joint House-SenateCommittee on Separation of Powers toaddress constitutional questions regard-ing separation of powers between thelegislative and executive branches ofgovernment.

March 10 ,- Attorney General Edmisten issues an ad-1982 visory opinion to Speaker of the House

Ramsey responding to two questions:(1) May the General Assembly appointnon legislative members to executive-branch boards and commissions? Yes.(2) May the General Assembly delegate

of powers doctrine. Following the signing of aconsent decree in court, the executive branch ineffect presents the legislature with a fait accompli,giving the legislature little choice but to fund thenew programs required by the court settlement. Ifthe legislature chooses not to appropriate therequired funds, the federal court could find thestate executive departments involved in contemptof the consent decree.

The Pennsylvania legislature, for example, hasrecently cut off funds to carry out two federalcourt orders, one to implement an automobileemissions inspection program and another tocreate an office overseeing court-ordered transfersof residents from a state home for the retarded.Pennsylvania legislators, according to State Legis-latures magazine, 14 claim exclusive authority toraise state funds and decide how to spend them."There is a strong body of thought here that thecourts have stepped across constitutional bound-aries," Assembly Majority Leader Samuel E.Hayes told The New York Times. is

6. Legislative Committee Exercising a Form ofVeto Over Executive Decisions. In 1981, the legis-lature empowered its Administrative Rules ReviewCommittee to suspend rules that exceed thestatutory authority of the departments issuingthem 16 Appeals from the committee's decisions maybe taken to the top of the executive branch, eitherto the governor (by departments under his direc-tion) or to the Council of State, a body composedof the persons heading executive departments

that authority to the speaker of theHouse and the president of the Senate?Probably.

March 17,- The Committee on Separation of Powers,1982 co-chaired by Speaker of the House

Ramsey and President Pro Tempore ofthe Senate Lawing, holds its first meet-ing and agrees that the legislature hassome constitutional problems as pointedout in the Bone decision , the SupremeCourt advisory opinion (see Feb. 16,1982) and several Attorney Generalopinions (see Jan. 19, Feb . 1, and Feb.23, 1982). They decide to address the41 boards and commissions questionedby Edmisten one at a time , in four sub-committees , and to report to the fullGeneral Assembly in June with recom-mendations . The Committee also plansto ask the Supreme Court for a furtheradvisory opinion addressing several re-lated issues.

March 18,- The Administrative Rules Review Com-1982 mittee meets in executive session where

Senior Deputy Att. Gen. Andrew A.Vanore, Jr. gives his opinion that theCommittee 's power to suspend regula-tions issued by state agencies and depart-ments is probably unconstitutional.

MAY 1982 43

who are elected officials. If either the governor orCouncil of State does not overturn the rule suspen-sion within a time specified by the new 1981legislation, the legislative committee action - therepeal of a rule - automatically goes into effect.Given this appeal procedure, the executive branchcan still have the last say. Nonetheless, the AttorneyGeneral's office notified the committee on March18, 1982, that the suspending power is probablyunconstitutional. Like the questions about legisla-tive membership on the EMC and the block grantcommittee dispute, this conflict also may end upin front of the state Supreme Court.

This North Carolina dispute parallels a currentnational clash between Congress and the President.For 50 years, the Congress has claimed a vetopower over executive actions far in excess of thetype of veto power recently asserted by the N.C.General Assembly. This congressional veto hastaken many forms. Some executive actions may beblocked by either house; others may be blockedby both houses acting together. In certain casesthe veto may even be exercised by a congressionalcommittee. The most recent example of thecongressional veto that attracted national atten-tion involved the sale of five radar planes toSaudi Arabia. By statute the President was em-powered to sell the planes to Saudi Arabia unlessboth houses of Congress disapproved the sale. TheU.S. House of Representatives promptly votedagainst it, and for weeks the nation awaited thevote in the Senate, which finally voted in favor ofthe sale.

The President has recently decided to challengethe congressional veto power in the courts. Unlikethe N.C. Supreme Court, the Supreme Court ofthe United States does not offer advisory opinions;consequently, the President has been waiting forsituations in which to raise the issue. One case isnow before the U.S. Supreme Court,17 and othersseem to be on their way up.18 The U.S. AttorneyGeneral, who normally defends the constitution-ality of federal statutes, is in these cases attackingit. The two houses of Congress, each representedby its own counsel, are arguing in favor of theirclaimed powers.

At this writing, the U.S. Supreme Court has notresolved the dispute. The cases raise many issuesin addition to the legislative veto, and each may bedecided on other grounds. But if the issue is everdecided on the national level, it could indirectlyaffect the North Carolina dispute. The effectwould only be indirect because of the differencesbetween the North Carolina and the federal consti-tutions. But it could be real nonetheless. In theEMC case the state Supreme Court looked to thefederal Constitution for guidance in interpretingthe N.C. Constitution.19 The same process couldoccur in the litigation on the legislative veto issue.

Judicial Common Ground

As the six trends discussed above show, theconstitutional crisis in state government has

spread very far in a very short time. These sixareas of concern, despite their many differences,share much in common because of the far-reachingpower of the judicial branch as it assumes itspolicymaking role. In turning to the separation ofpowers concept in the Bone decision, the judicialbranch drew clear lines between the functions ofthe legislative and executive branches. While the"jury is still out" on many of the questions dis-cussed in the section above, several judicial charac-teristics affecting the outcomes are clear.

•A statute is presumed constitutional untilchallenged through litigation. Thus, statutes au-thorizing legislators to serve on other boards andcommissions in the executive branch - whilequestionable under the Bone decision - are pre-sumed to be constitutional until challenged. Simi-larly, while the Attorney General has said thelegislative Committee on Employee Hospital andMedical Benefits is unconstitutional, the commit-tee may well continue to function until challengedin court.

•Because of the legal rule of following priordecisions in similar cases, the EMC decision alsocould apply to all similarly constituted commis-sions. This doctrine prompted the AttorneyGeneral to advise legislators to resign from some41 executive branch boards and commissions. Butlegislators continue to function on some verypowerful bodies - such as the Advisory BudgetCommission - which may be constituted like theEMC. On February 26, the ABC began to functionby making "recommendations to the Governor"rather than by taking direct action on budgetrequirements. If someone challenges an ABCaction taken even in this manner, the Bone deci-sion is a legal precedent on which to stand.

• The EMC case or similar cases cannot go intothe federal court system. When a state supremecourt interprets the state constitution on a mattersolely of significance to the state, there is no basisfor an appeal to the Supreme Court of the UnitedStates.

• When the N. C. Supreme Court issues an advi-sory opinion, it is not binding in the same waythat a decision in litigation is binding. Even so,an advisory opinion indicates how that same groupof judges would adjudicate a similar question.Since the earliest days of the republic, the U.S.Supreme Court has refused to issue advisoryopinions. Only a handful of state courts issuesuch opinions, and the N.C. Supreme Court hasnot issued one since 1969. Moreover, perhapsalone among American state courts, the N.C.Supreme Court issues advisory opinions without

44 N.C. INSIGHT

express constitutional or statutory authorization.Ironically, one of the major arguments in otherstates against advisory opinions is that they vio-late the separation of powers doctrine. Judicialpower, it is said, should be limited to decidinglitigated cases. When justices issue opinions oncontentions that have not yet been the subject oflegal dispute, these justices approach the statusof lawmakers.

Conclusion

Because the N.C. Supreme Court took an activepolicymaking role in issuing an advisory opin-

ion of far-reaching influence on February 16(regarding the two budgetary matters), those sevenjustices may be called upon once again to wadeinto uncharted separation-of-powers territory. OnMarch 5, Speaker of the House Ramsey andPresident Pro Tempore of the Senate Craig Lawingestablished a joint House-Senate Committee onSeparation of Powers. The committee held its firstmeeting on March 17 and agreed that the legisla-ture has some constitutional problems as pointedout in the Bone decision, the Supreme Court'sadvisory opinion, and several Attorney General'sopinions.

The Committee decided to examine the 41executive-branch boards and commissions ques-tioned by Edmisten one at a time, through foursubcommittees, and to report to the full GeneralAssembly in its June session with recommenda-tions. In addition, the committee planned to askthe Supreme Court for another advisory opinionon a variety of separation of powers questions,including the following:

• Can executive branch officials (like the gover-nor and lieutenant governor) appoint legislatorsto executive-branch boards instead of havinglegislative officials (like the speaker of the Houseand president pro tempore of the Senate) makethe appointments?

• Can the legislature appoint non-legislators toexecutive boards and commissions, and if so, can italso delegate that power to its presiding officers?

• How far can the legislature go in restrictingthe use of state money without treading on thepower of the governor?

• Must someone resign his or her seat on aboard or commission if he or she is elected to thelegislature?

Whatever the Special Committee on Separationof Powers may decide to do and whatever anyfuture Supreme Court advisory opinions mayfinally say, the sorting out process triggered by theBone decision is just beginning. The business ofstate government in North Carolina has grown sorapidly - the state budget has more than doubledsince 1973 - that separation-of-powers questions

have been obscured under a sweeping tide ofgovernment programs and actions. The contestsfor power among the executive, legislative, andjudicial branches signal not a breakdown of thesystem but a return to health.

The founding fathers were pessimistic about theability of the powerful to exercise self-restraint.But they were optimistic about their own abilityto construct a constitutional order in which onepower would restrain another. As James Madisonput it in No. 51 of The Federalist:

The great security against a gradual con-centration of the several powers in thesame [branch] consists in giving to thosewho administer each [branch] thenecessary constitutional means and perso-nal motives to resist encroachments ofthe others.

The experience of the last two centuries seemsto confirm that Madison and his colleagues under-stood the value of restraints in keeping menand women free. In the coming months and years,the N.C. Supreme Court, the legislature, andexecutive officials will have to separate some oftheir powers, even as their work becomes moreintertwined and interdependent. Against such adifficult task, the words of James Madison mightwell assist them in discovering exactly what "con-stitutional means and personal motives" can best"resist encroachments of the others." 0

FOOTNOTES

1 State ex rel. Wallace v. Bone, 304 N.C. 591, 286S.E.2d 79 (1982).

2 The North Carolina Center for Public Policy Researchwill publish this summer a comprehensive analysis of themore than 400 boards, commissions , and councils thatexist.

3 N.C. Constitution, Art. 1, Section 6.

4 Memorandum from Rufus L. Edmisten, AttorneyGeneral, to Liston B. Ramsey, Speaker, House of Repre-sentatives, February 1, 1982, page 1.

5 N.C.G.S. 143-23(b).

6N.C.G.S. 143-23.7N.C.G.S. 120-71.

8N.C.G.S. 120-84.59 Advisory Opinion in re N.C.G.S. 143-23(b) and 120-

84.1 through 120-84.5, 305 N.C. _ (1982), p. 7.10lbid.

11 Chapter 964 of the 1981 Session Laws (HB 42),

Section 20.12Advisory Opinion, op. cit.13N.C.G.S. 135-33.14State Legislatures, January 1982, p. 5.

islb id.

MAY 1982 45

16N.C.G.S. 120-30.28.17 Immigration and Naturalization Service v. Chadha,

634 F.2d 408 (9th Cir., 1980 ), cert. granted , 102 S.Ct. 87(1981).

18 For example , Consumer Energy Council of Americav. Federal Energy Regulatory Commission, , F.2d

(D.C. Cir., 1982 ). In a vigorous opinion, the U.S.

Legislators Serve onNinety Executive Boards -

Oversight or Overkill?by Lacy Maddox

In the summer of 1981 , the N .C. Center forPublic Policy Research began a 12-monthproject surveying and analyzing the approxi-mately 400 boards , commissions , and councilsfunctioning in state government. Because thenumber of these groups has increased so rapidlyin recent years, few persons in the state under-stand the growing and complex role thatboards , commissions , and councils play. Yet nocompendium of this unwieldy collection ofgroups exists.

On February 11, 1982 , as a first installmentof the year -long project , the Center released"Separating the Executive and LegislativeBranches: Boards, Commissions, and Councilswith Legislative Members." Only weeks before,the N.C. Supreme Court had ruled that havingfour legislators on the Environmental Manage-ment Commission (EMC) violated the separationof powers provision in the N .C. Constitution. Aseries of high-level consultations followed thisruling, including an official advisory opinionfrom the Attorney General, regarding the legalstatus of all boards and commissions withlegislative members. As staff attorneys in thelegislature and the Attorney General's officewere furiously researching the N.C. GeneralStatutes for references to boards and commis-sions , the Center released its February report.

"The N .C. Center for Public Policy Researchhas found that in addition to legislative member-ship on 36 boards with executive functions,legislators serve on 54 other boards that areadvisory in nature, " The News and Observer ofRaleigh summarized in its editorial of February17, 1982. "Their legal status is unclear. But it isobvious that the legislature must review, withan eye toward repealing or amending, allstatutes mandating legislative membership onnon legislative boards and commissions."

The Center 's report had gone a step further:"Unless prompt attention is given to thismatter , many of the decisions made by executive

Court of Appeals for the District of Columbia held that thelegislative veto violates the federal Constitution.

19 "While the federal constitution contains no explicitprovision regarding separation of powers , the principle isclearly implied . Article I, Section 1, provides that '[a] 11legislative powers herein granted shall be vested in aCongress of the United States, which shall consist of a

branch boards with legislators on them will besuspect .... Some farmers recently sued theBoard of Transportation , alleging that havinglegislators among its membership invalidates theBoard's decision to run Interstate Highway 95through their land.... We think the bestsolution is to remove legislators from all 90 ofthese boards, commissions , and councils andreplace that practice with strong legislativeoversight committees."

The report further recommended that thelegislature establish a study committee toreview legislative membership on executive-branch boards, commissions and councils, andthat this committee report to the full GeneralAssembly in its June 1982 session . In earlyMarch, the Speaker of the House and thePresident Pro Tempore of the Senate formedsuch a committee.

In preparing its report , the Center appliedthe N.C. Supreme Court ruling on the EMC, aswell as similar decisions in Kansas and Colorado,to the 90 groups in question , finding that 36groups "probably violate the separation ofpowers provision." Staffs in both the executivebranch (Attorney General) and the legislativebranch (General Assembly 's Bill DraftingDivision) subsequently came up with similarlists ; all three lists agree that these 36 boards,commissions , and councils have executive oradministrative functions and are unconstitu-tional under the EMC decision.

The 36 groups identified by the Center arelisted below by executive department. TheAttorney General's staff identified the followingsix additional groups (a total of 42) withexecutive or administrative functions:

1. Child and Family Services InteragencyCommittee;

2. Governor's Advocacy Council on Childrenand Youth;

3. Education Commission of the States;4. Southern Growth Policies Board;5. N.C. Alcoholism Research Authority; and6. Commission on Indian Affairs.

The legislative staff agreed on 37 of these 42groups, but said that the first four of those

Lacy Maddox is research coordinator for the N.C.Center for Public Policy Research.

46 N.C. INSIGHT

senate and house of representatives.' Article II, Section 1,provides that `[t] he executive power shall be vested in apresident of the United States of America.' Article III,Section 1, provides that `[t]he judicial power of theUnited States shall be vested in one supreme court,and in such inferior courts as the Congress may from timeto time ordain and establish.... '

listed above were only advisory in nature. TheCenter found 54 additional groups, includingthe six above, that are advisory in nature butwhich have legislative members. The N.C.Supreme Court has not said whether it sees aconstitutional distinction between administra-tive and advisory functions in executive-branchboards, commissions, and councils. The Courtcould say that any executive-branch board withlegislative members (even though the group'sfunctions are advisory) violates the separa-tion of powers provision.

The full report by the Center includes alisting of all 90 groups with legislative membersby executive-branch department, and for eachgroup, the statute authorizing the appointmentof legislators, the number of House and Senatemembers, and the number of legislators ap-pointed by the Governor. The report is avail-able from the Center for $1.00. The results ofthe year-long study of all 400 groups will bereleased later this year.

EXECUTIVE-BRANCH GROUPS

VIOLATING SEPARATION OF

POWERS PROVISION

DEPARTMENT OF ADMINISTRATION

1. Board of Public TelecommunicationsCommissioners

2. Capital Building Authority3. Capital Planning Commission4. Governor's Advocacy Council for Persons

with Disabilities5. Housing Finance Agency, Board of

Directors6. Incentive Pay Review Commission7. Land Conservancy Corporation, Board of

Trustees8. N.C. Council on the Status of Women9. Public Officers' and Employees' Liability

Insurance Commission10. School of Science and Mathematics, Board

of Trustees

DEPARTMENT OF AGRICULTURE

11. Board of Agriculture12. Farm Operations Commission

"There is abundant evidence that the drafters of thefederal constitution had the separation of powers princi-ple in mind, and, for the most part, the principle has beenchampioned and adhered to throughout the history of ourrepublic." State ex rel. Wallace v. Bone, 304 N.C. 591,286 S.E.2d 79 (1982). See also text relating to footnote3 above.

DEPARTMENT OF COMMERCE13. Economic Development Board14. N.C. Board of Science and Technology15. Seafood Industrial Park Authority16. State Ports Authority

DEPARTMENT OF CRIME CONTROL ANDPUBLIC SAFETY

17. Governor's Crime Commission18. State Fire Commission

DEPARTMENT OF CULTURAL RESOURCES

19. Art Museum Building Commission20. Museum of Art, Board of Trustees

DEPARTMENT OF HUMAN RESOURCES

21. Commission for Mental Health, MentalRetardation, and Substance Abuse Services

22. Social Services Commission23. Waste Management Board

DEPARTMENT OF JUSTICE

24. Criminal Justice Education and TrainingStandards Commission

DEPARTMENT OF LABOR

25. Apprenticeship Council

DEPARTMENT OF NATURAL RESOURCESAND COMMUNITY DEVELOPMENT

26. Coastal Resources Commission27. Environmental Management Commission28. Wildlife Resources Commission

DEPARTMENT OF REVENUE

29. Property Tax Commission

DEPARTMENT OF TRANSPORTATION

30. Board of Transportation

DEPARTMENT OF TREASURER

31. Law Enforcement Officers Benefit andRetirement Fund, Board of Commissioners

32. Municipal Board of Control33. Teachers' and State Employees' Retirement

System, Board of Trustees

INDEPENDENT GROUPS

34. Advisory Budget Commission35. Ports Railway Commission Board of

Directors36. UNC Center for Public Television, Board

of Trustees

MAY 1982 47