New York State, New York City, and Valerie Rodriguez appeal from an order of the United States District Court for the Southern District of New York (Cannella, J.) that denied their motion for a preliminary injunction against Richard E. Lyng, Secretary of Agriculture of the United States. Appellants challenge the Secretary's ruling that the "restaurant allowance" provided by New York State is counted as income to its recipients when determining their food stamp eligibility. Affirmed.
Newman, Cardamone and Winter, Circuit Judges.
CARDAMONE, Circuit Judge:
The State and City of New York and Valerie Rodriguez, on behalf of herself and her children, (appellants), appeal from an order of the United States District Court for the Southern District of New York (Cannella, J.), denying their motion for a preliminary injunction against the Secretary of Agriculture of the United States, Richard E. Lyng (Secretary). Appellants challenge the Secretary's ruling that the State and City must count an extra public assistance payment -- a "restaurant allowance" provided under New York law -- as income for the purpose of computing food stamp eligibility. The "restaurant allowance" is paid to those individuals unable to prepare meals at home, primarily the homeless and the disabled, as reimbursement for the extra expenses they incur when purchasing prepared foods. We affirm.
Ms. Rodriguez and her four infant children have been residents of a "welfare" hotel without cooking facilities since August 1985 and are recipients of both food stamps and the restaurant allowance. The effect of the Secretary's ruling is that she and other restaurant allowance recipients lose 30 cents in food stamps for every dollar received under the allowance. Judge Cannella upheld the Secretary's interpretation of the regulations implementing the Food Stamp Act and denied appellants' motion for a preliminary injunction. This decision and our affirmance is not a sign that the courts are insensitive to New York's attempt to better the plight of its homeless. But it does suggest that a court may not properly substitute its own notion of what is "fair" economic policy for those living at a poverty level -- no matter how strongly those notions are held -- where to do so would set aside, as here, the advised actions of the executive and legislative branches of government.
The Food Stamp Act of 1977 provides federal assistance to low-income households in order to help the members of these households obtain a more nutritious diet. Assistance is paid in the form of coupons -- or food stamps -- used to purchase food. The amount of food stamps a household receives is determined by its size and income as defined by the Food Stamp Act. 7 U.S.C. §§ 2012(o), 2017(a) (1982). For purposes of the Act, it is assumed that a household will use 30 percent of its income to purchase food. The dollar amount of food stamps received by a given household is determined by subtracting 30 percent of the household's income from the assumed monthly cost of providing a nutritious diet for that household.
The United States Department of Agriculture's "Thrifty Food Plan" (Plan) estimates the average food costs of the food stamp family. See 7 U.S.C. § 2012(o) (1982). The Plan assumes that recipients will have sufficient storage, refrigeration, and cooking facilities to prepare food at home. See H.R. Rep. No. 464, 95th Cong., 1st Sess. 207, reprinted in 1977 U.S. Code Cong. & Admin. News 1978, 2170 (House Report). Food stamps generally cannot be used to purchase "hot foods or hot food products ready for immediate consumption." 7 U.S.C. § 2012(g)(1) (1982). Exceptions are made for meals provided by public or private nonprofit organizations to the disabled, id. § 2012(g)(4), and the homeless, 7 U.S.C.A. § 2012(g)(9) (West Supp. 1987), as well as others unable to prepare meals at home. See, e.g., 7 U.S.C. § 2012(g)(8) (1982).
In calculating food stamp allotments normal public assistance grants are generally included as "income" by the Secretary. Some grants are explicitly excluded under exceptions codified at 7 U.S.C. § 2014(d) (1982 & Supp. III 1985). New York State has chosen to supplement regular public assistance payments with a "restaurant allowance" paid directly to those individuals who, either lacking cooking facilities or too disabled to cook, are forced to purchase prepared foods away from home. This allowance is provided as a reimbursement for the additional expense incurred by these individuals. Most eligible individuals receive 71 cents per meal; pregnant women and children receive $1.10 per meal. In 1983, the State of New York sought clarification from the Secretary as to whether the "restaurant allowance" might be excluded from income under subsection 5 of § 2014(d) and its implementing regulations, 7 C.F.R. § 273.9(c)(5). The Secretary advised that the allowance did not qualify as an exception, and that it was includable in the calculation of a recipient's income.
Two years after this ruling, appellants brought the instant action and moved for a preliminary injunction barring the Secretary from including New York State's restaurant allowance as income. The State, City, and individual appellants make two principal arguments. They contend, first, that the Secretary's policy is inconsistent with the Food Stamp Act, its implementing regulations and with the Secretary's own rulings defining income. Second, they assert that the Secretary did not comply with the notice and publication requirements of the Administrative Procedures Act. 5 U.S.C. §§ 552 (a)(1), 553 (1982). Before discussing the merits, we examine the scope of our power to review and the rules of deference usually accorded an agency that is interpreting its own regulations.
Scope of Review and Deference to Agency
The initial question to be discussed is our scope of review when a district court denies a motion for a preliminary injunction. Ordinarily, such review is "limited to determining whether the trial court abused its discretion in finding the presence or absence of irreparable harm and a probability that the plaintiffs would succeed on the merits." Thornburgh v. American College of Obstetricians & Gynecologists, 476 U.S. 747, 106 S. Ct. 2169, 2176, 90 L. Ed. 2d 779 (1986). But, an abuse of discretion standard is not an inflexible rule governing review when the district court's ruling is solely on the law and the facts are not of controlling relevance. When such is the case and with a full record before it, an appellate court need not accord the customary deference to the district court's discretion, but instead may employ its own plenary scope of review. Id. at 2177. Because that is the precise circumstance of the instant appeal, that is to say, we have a complete factual record before us, and the question presented relates solely to a question of law, we undertake plenary review of the merits.
To succeed in their challenge, appellants must overcome accumulated judicial wisdom that the Secretary's view in this complex area is more expert than that of the courts. This proposition has been variously expressed as "an agency's construction of its own regulations is entitled to substantial deference." Lyng v. Payne, 476 U.S. 926, 106 S. Ct. 2333, 2341-42, 90 L. Ed. 2d 921 (1986). Or, the mere existence of "more equitable" alternatives "does not render the Secretary's choice invalid." Knebel v. Hein, 429 U.S. 288, 294, 50 L. Ed. 2d 485, 97 S. Ct. 549 (1977) (upholding the Secretary's inclusion in income of a transportation allowance under the 1964 Food Stamp Act). Again, it is not sufficient that appellants show that there are other reasonable ways to construe the statute; rather, they must demonstrate that the Secretary's interpretation is "'plainly erroneous or inconsistent with the regulation.'" United States v. Larionoff, 431 U.S. 864, 872, 53 L. Ed. 2d 48, 97 S. Ct. 2150 (1977) (quoting Bowles v. Seminole Rock & Sand Co., 325 U.S. 410, 414, 89 L. Ed. 1700, 65 S. Ct. 1215 (1945).
As the Court in Knebel reiterated: "'courts should defer to the informed experience and judgment of the agency to whom Congress delegated appropriate authority.'" 429 U.S. at 294 n.14 (quoting Mourning v. Family Publications Serv., Inc., 411 U.S. 356, 372, 36 L. Ed. 2d 318, 93 S. Ct. 1652 (1973)). Although Knebel was decided under the Food Stamp Act of 1964, Pub. L. No. 88-525, 78 Stat. 703, which gave the Secretary more authority to define income than the present Act, see House Report, supra, at 19, the proposition for which it is cited here remains viable. See St. Mary's Hosp. of Troy v. Blue Cross & Blue Shield Ass'n, 788 F.2d 888, 891 (2d Cir. 1986). And, as Justice Blackmun observed, concurring individually in Lukhard v. Reed, 481 U.S. 368, 107 S. Ct. 1807, 95 L. Ed. 2d 328 (1987), a case involving the definition of income under the Aid to Families and Dependent Children program: "In a statutory area as complicated as this one, the ...