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Commonwealth v. State Civil Service Commission (Wheeland)

Commonwealth Court of Pennsylvania

October 18, 2019

Commonwealth of Pennsylvania, Pennsylvania Game Commission, Petitioner
v.
State Civil Service Commission (Wheeland), Respondent

          Submitted: May 8, 2019

          BEFORE: HONORABLE MARY HANNAH LEAVITT, President Judge HONORABLE RENÉE COHN JUBELIRER, Judge HONORABLE P. KEVIN BROBSON, Judge HONORABLE PATRICIA A. McCULLOUGH, Judge HONORABLE ANNE E. COVEY, Judge HONORABLE MICHAEL H. WOJCIK, Judge HONORABLE CHRISTINE FIZZANO CANNON, Judge

          OPINION

          MARY HANNAH LEAVITT, PRESIDENT JUDGE

         The Pennsylvania Game Commission petitions for this Court's review of an adjudication of the State Civil Service Commission ordering the reinstatement of Timothy A. Wheeland to his position as Wildlife Maintenance Propagator. The Game Commission furloughed Wheeland when it closed the pheasant game farm where Wheeland worked as a cost-savings and efficiency measure after receiving a substantial budget cut. The Game Commission contends that the Civil Service Commission erred in holding that the Game Commission's evidence did not make a prima facie case that Wheeland's furlough was necessitated by lack of funds and in refusing even to address the Game Commission's evidence that his furlough was also necessitated by a lack of work.

         Background

         On December 12, 2016, the Game Commission notified Wheeland that he would be furloughed as of January 27, 2017, due to a lack of funds. Pursuant to Section 951(a) of the former Civil Service Act, [1] Wheeland appealed to the Civil Service Commission, which held a hearing on May 2, 2017.

         The Game Commission called Robert Boyd, the Wildlife Services Division Chief for the Game Commission's Bureau of Wildlife Management, to testify about why the Game Commission closed the North Central Game Farm and furloughed Wheeland and five other pheasant propagators who worked there. The Bureau, inter alia, operates a pheasant propagation program that hatches pheasant chicks and raises them at game farms located in different parts of the state. As Division Chief, Boyd is responsible for the pheasant propagation program's finances and budget. Notes of Testimony, 5/2/2017, at 14-15 (N.T.__); Reproduced Record at 65a-66a (R.R.__).

         Boyd identified two Game Commission memoranda that were authored by the agency's Executive Director, Robert Hough. Boyd was the recipient of one memorandum and copied on the other. In the first memorandum, Appointing Authority Exhibit 1, Hough wrote to staff on April 7, 2015, that the Game Commission had been instructed by the Governor's Office to reduce "this year's budget by an additional $5.2 million; this is on top of the $14 million we were already required to cut from our budget this winter." Appointing Authority Exhibit 1 (AA-1); R.R. 18a. The memorandum cited a decline in the Game Commission's revenue from natural gas leases of state game land. Hough's second memorandum, Appointing Authority Exhibit 2, was addressed to the Governor's Secretary of Administration and notified the Secretary that the Game Commission intended to furlough 13 pheasant propagators, effective January 27, 2017.[2] Boyd was one of four senior Game Commission staff copied on this communication to the Secretary of Administration.

         Boyd testified that the Game Commission was instructed to reduce expenses because its funding had been reduced by 10 percent for fiscal year 2015-2016 and 25 percent for the following year. Boyd testified that his Bureau implemented these instructions by not filling vacant propagator positions and deferring certain capital improvements. Most significant was the Bureau's decision to end the pheasant hatchery operations and move to a "chick purchase program." N.T. 19; R.R. 70a. Boyd explained that in 2015 the Game Commission spent $4.7 million on pheasant propagation; in 2017, this was reduced to $3 million. Boyd explained that personnel constitutes the largest single expense item in the Bureau's budget for the pheasant propagation program.

         Boyd explained how the decision to furlough Wheeland was made. He stated that because "we didn't get our license fee increase" from the legislature, it was decided to close the game farms to save money. N.T. 21; R.R. 72a. Initially, all four game farms were slated for closure. However, Boyd explained that "it was decided to go ahead and keep the program alive because it does add value[] to the Agency and to our Sportsmen Unlimited." Id. Accordingly, the Game Commission decided to keep two farms open, one in each part of the state. He explained how the Bureau chose the farms to be closed:

Q. And how did you pick which farms would be closed?
A. Well, it was a very difficult decision, but we divided the state into two halves, the eastern half and the western half. In the west, it---if you're looking at farms that would be in the central part of that area[, ] the Southwest Game Farm was sort of an easy winner over the Western Game Farm.
In the eastern part of the state, the Loyalsock and [North Central] Game Farms are both very close together. So really the deciding factor there was the fact that Loyalsock Game Farm had a breeder flock. [It] no longer had the breeder flock, so [it] had open pens that we could use for increased holding capacity for birds released in the fall for sportsmen.
The [North Central] Game Farm did not have a breeder flock previously and did not have those empty pens available.
Q. Mr. Boyd, is it necessary to have additional Wildlife Maintenance Propagators in order to raise the chicks at the remaining farms?
A. No. We're --- we're planning to make do with the existing staff at the Southwest and Loyalsock Game Farms.

N.T. 21-23; R.R. 72a-74a.

         Wheeland, who was pro se, then questioned Boyd. Wheeland, who lives close to the North Central Game Farm where he had worked prior to the farm's closure, informed Boyd that "on a pretty regular basis" he saw employees maintaining the grounds. N.T. 24; R.R. 75a. When asked about these employees, Boyd responded that staff from the two remaining game farms worked at the North Central Game Farm as needed, leaving "no unmet needs in terms of manpower." N.T. 25; R.R. 76a. Wheeland then stated that when the Game Commission first considered buying chicks, he and other propagators were told they would not be furloughed. In response, Boyd explained as follows:

By buying chicks, we're saving money and improving our efficiency. But there were no plans to furlough anybody. If we were able to go through with four farms and buy chicks, we were going to go with full force. It's only not getting the license fee increase that caused this level of crisis to escalate to the point we had to close two farms because of the lack of revenue to the [Game Commission].

N.T. 26; R.R. 77a (emphasis added). In short, it was the "lack of revenue" from anticipated license fee increases that required the closure of two game farms.

         Wheeland questioned Boyd about the Game Commission's decision to hire 35 new Wildlife Conservation Officer Cadets contemporaneously with the furloughs. Wheeland presented a job description for a "Wildlife Conservation Officer Cadet." Appellant Exhibit 1; R.R. 48a. He also presented an email he received from the district office of Pennsylvania State Representative Garth Everett. Appellant Exhibit 2; R.R. 50a. Representative Everett's email to Wheeland estimated that hiring 35 new Wildlife Conservation Officer Cadets would cost approximately $2 million.

         Wheeland asked Boyd how the Game Commission could afford to hire the cadets while also finding it necessary to furlough propagators. Boyd replied, "[j]ust understand that I'm in charge of the Pheasant Propagation Program. I don't work at the higher level where these decisions are being made about what gets cut…." N.T. 31; R.R. 82a. Wheeland then asked, "I'm sure you're aware of all this, though. Correct?" Id. Boyd responded in the affirmative. Wheeland asked Boyd why, in defending the pheasant propagation program against furloughs, Boyd did not object to the cadet hirings. Boyd responded, "Maybe I did." N.T. 32; R.R. 83a.

         Wheeland was sworn and then presented his case. Wheeland opined that the propagators should have been employed until the end of the fiscal year "seeing as how the budget was already in place. There was money there to pay to [the propagators]. There was still work to be done." N.T. 42; R.R. 93a. Wheeland testified that, during the winter, propagators do maintenance on machinery at the farms. He stated that he and the other propagators could have done maintenance at the North Central Game Farm instead of "pushing it to one of the other two farms and you know, making them maintain it." N.T. 45; R.R. 96a.

         The Game Commission objected to the admission of Wheeland's exhibits, Appellant Exhibits 1 and 2, as irrelevant. The Commissioner conducting the hearing stated, "I'm going to go ahead and admit [them] for the record…. [W]e will give those the weight they deserve during our adjudication of this matter. But I don't see any reason to keep them out of the record." N.T. 36; R.R. 87a. He also stated that "[o]ne thing that is not going to come out of our decision in this matter is we're not going to second-guess the [Game] Commission and the Executive Director's decision as to priority functions." Id.

         The Game Commission moved to admit both Appointing Authority Exhibits 1 and 2, and Wheeland did not object. The Commissioner stated:

So, AA-1, the two Appointing Authority exhibits, AA-1 and AA-2 will be admitted into the record without objection.
And likewise, I do think that they provide a little more detail of the budget situation that the [Game Commission] was facing at the time of the furlough. So I think they're going to be given just not equal weight, probably a little more weight.

N.T. 38; R.R. 89a.

         Adjudication

         The Civil Service Commission sustained Wheeland's appeal. The Civil Service Commission found that the Game Commission's admitted exhibits "AA-1 and AA-2" were hearsay and not entitled to probative value. It further found that Boyd's testimony did not corroborate the Game Commission's admitted exhibits, reasoning that Boyd did not have personal knowledge of the relationship between the Game Commission's funding and Wheeland's furlough.

         In its adjudication, the Civil Service Commission made the following conclusion of law:

The appointing authority has failed to present evidence establishing a lack of funds sufficient to justify furlough under Section 802 of the Civil Service Act, as amended.

Civil Service Commission Adjudication at 17. Based on this conclusion, it ordered the Game Commission to expunge the furlough from Wheeland's record, return Wheeland to regular employment as a Wildlife Maintenance Propagator within 30 days and reimburse Wheeland for all wages and emoluments due since January 27, 2017, less wages and benefits received.

         Appeal

         On May 1, 2018, the Game Commission petitioned for this Court's review, [3] and it makes three arguments on appeal. First, it argues that the Civil Service Commission erred in holding that the Game Commission did not present a prima facie case that lack of funds caused Wheeland's furlough. Second, it argues that the Civil Service Commission erred in refusing to address the Game Commission's evidence that lack of work caused Wheeland's furlough. Third, it argues that in reaching its conclusion, the Civil Service Commission improperly considered the Game Commission's decision to hire additional law enforcement personnel.[4]

         I.

         We begin with a review of the law relevant to the furlough of employees protected by the Civil Service Act. Our Supreme Court has explained as follows:

A "furlough" is defined by Section 3(s) of the Civil Service Act . . . as a "termination of employment because of lack of funds or of work." When there has been called into question the validity of a furlough, the appointing authority has the burden of going forward with proof to establish a prima facie case justifying the furlough, viz, that the furlough resulted from a lack of funds or a lack of work. 4 Pa. Code §105.15.[5]

Department of State v. Stecher, 484 A.2d 755, 757 (Pa. 1984). A lack of funds "exists when insufficient revenue is available to meet all financial demands unless modifications are made in the system." Forbes v. Department of Transportation, 434 A.2d 892, 894 n.4 (Pa. Cmwlth. 1981). To establish a prima facie case on lack of funds, the appointing authority must present "specific evidence of the need for financial cuts which would justify the furlough." Beaver County v. Funk, 492 A.2d 118, 121 (Pa. Cmwlth. 1985).

         To show a lack of funds, the Game Commission offered several pieces of evidence. It offered two contemporaneous memoranda authored by the Game Commission's Executive Director. One memorandum was sent to Game Commission staff, and the other was sent to the Governor's Office. The Commissioner conducting the hearing observed that the two memoranda "provide a little more detail on the budget situation that the Game Commission was facing at the time of the furlough" and would be given "a little more weight." N.T. 38; R.R. 89a. In its adjudication, however, the Civil Service Commission did a volte face on these admitted memoranda, concluding that they were not entitled to any weight because they were hearsay.

         The Game Commission also offered the testimony of Boyd. The Civil Service Commission did not find Boyd's testimony incompetent or incredible; rather, it concluded that Boyd had not been sufficiently specific.

         In so holding, the Civil Service Commission relied upon Beaver County, 492 A.2d 118, where the county furloughed an employee for lack of funds. The county's witness testified that the county had made a policy decision to cut personnel costs, but his testimony did not connect this policy decision to a lack of funds. At best, the county's witness made "general statements about the County's 1982 deficit." Id. at 121. It did not present "specific evidence of the need for financial cuts which would justify the furlough." Id.

         Beaver County is distinguishable because the Game Commission presented "specific evidence of the need for financial cuts." Id. Boyd testified that the legislature's decision not to adopt a pheasant hunting license (and the attendant license fee) or to raise the existing fees for hunting licenses created a "crisis" that required the Game Commission "to close two farms." N.T. 26; R.R. 77a. Boyd explained that this fee revenue was needed because of declining revenue from natural gas leases. Further, Boyd identified the actual savings realized by the reduction in the pheasant propagation program, for which he had budget responsibility. The 2015-2016 budgeted expense of $4.7 million for the pheasant propagation program was reduced to $3 million in 2017. In sum, Boyd provided detail on loss of funding that had been absent from the county's testimony in Beaver County.

         In addition, Hough's April 2015 memorandum to Game Commission staff projected a $35 million deficit by 2019 if reductions in expenditures were not made. Exhibit AA-1; R.R. 18a. Thus, the Game Commission's evidence showed insufficient revenue "to meet all financial demands unless modifications are made in the system." Forbes, 434 A.2d at 894 n.4.

          The Civil Service Commission's decision to reject the Game Commission's evidentiary case on lack of funds cannot be reconciled with this Court's holding in Forbes, 434 A.2d 892. In Forbes, this Court considered the furlough of an employee of the Department of Transportation for lack of funds. To support its furlough, the Department presented a memorandum authored by the Secretary of Transportation, which the employee challenged as insufficiently specific. This Court rejected this argument, citing the testimony of the Deputy Secretary of Highway Administration about the memorandum:

The witness indicated that, upon learning that the Legislature had not provided as much revenue as [the Department] needed to maintain its funding level, the Secretary sent a memorandum to the appropriate staff persons alerting them to which programs had been cancelled, or curtailed, and directing them to make modifications in their personnel requirements to reflect the budget reorganization.

Id. at 894 (internal footnote omitted) (emphasis added). This Court concluded that the Deputy Secretary's testimony together with a copy of the Secretary's internal memorandum describing the Department's fiscal challenges constituted substantial evidence that a lack of funds caused the employee's furlough.

         Likewise, here, the Game Commission presented a memorandum of its agency head, Robert Hough, about the Game Commission's revenue reductions and projected deficit, as well as the testimony of "an appropriate staff person," i.e., Boyd. Id. Boyd received Hough's memorandum "alerting" Game Commission staff of the curtailed budget and "directing them to make modifications in their personnel requirements." Id. Boyd's knowledge about the funding cuts from the Game Commission was even acknowledged at the hearing by Wheeland, who stated, while referring to the pheasant propagation program cuts, "I'm sure you're aware of all this, though." N.T. 31; R.R. 82a. Wheeland acknowledged Boyd's presence at the Game Commission meetings where the furlough decisions were made, even chastising Boyd for not doing a better job of defending the pheasant propagation program.

         After admitting Executive Director Hough's memoranda, one internal to the Game Commission and the other a communication to the Governor's Office, the Civil Service Commission refused to consider them for the stated reason that they constituted hearsay. This was error. Assuming, arguendo, that the two memoranda were hearsay, they were entitled to be given probative value under Walker v. Unemployment Compensation Board of Review, 367 A.2d 366 (Pa. Cmwlth. 1976).

         The so-called Walker rule provides that a fact-finder may give hearsay evidence admitted without objection its natural probative effect so long as it is corroborated by competent evidence of record. Id. at 370. The Game Commission's file memoranda were admitted into the record without objection and entitled to probative effect because they were corroborated by Boyd, who received both memoranda.

         Boyd demonstrated his personal knowledge of the Game Commission's funding shortage. The problem began with a decline in the agency's natural gas revenue. In response, Boyd testified that his Bureau cut spending by deferring capital improvements and not filling vacancies. Boyd explained, however, that the Game Commission needed a pheasant hunting license or increased hunting license fees to sustain operations. When that did not occur, a "crisis" developed for the pheasant propagation program, for which personnel was the largest single expense item. This required the closure of the North Central Game Farm where Wheeland worked. Boyd testified specifically about his direct involvement in the decision to close two game farms and furlough Wheeland and others.[6] Boyd's personal knowledge of the Game Commission's revenue challenges, i.e., "loss of funds," was demonstrated throughout his testimony and was acknowledged even by Wheeland.

         Boyd's testimony constituted competent evidence that corroborated both memoranda. This allowed the Civil Service Commission to make findings of fact on the basis of both of Hough's memoranda. Even so, the Civil Service Commission erred in making the assumption that these memoranda constituted inadmissible hearsay. The word "hearsay" was not spoken at the hearing, either during testimony or in closing argument. The Commissioner conducting the hearing informed the parties that the Game ...


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